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Canadian federalism : a major constraint on the development of national transportation policy : lessons… Ropertz, Henry 1989

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CANADIAN FEDERALISM: A MAJOR CONSTRAINT ON THE OF  DEVELOPMENT  NATIONAL TRANSPORTATION POLICY LESSONS FROM CHANGES TO THE CROW RATE By HENRY ROPERTZ A THESIS SUBMITTED I N P A R T I A L FULFILLMENT OF THE REQUIREMENTS FOR THE DEGREE OF DOCTORATE OF PHILOSOPHY in THE FACULTY OF GRADUATE STUDIES Department o f I n t e r d i s c i p l i n a r y  We a c c e p t t h i s t h e s i s to the required  Studies  as conforming standard  THE UNIVERSITY OF B R I T I S H COLUMBIA O c t o b e r 1989 ( c J H e n r y R o p e r t z , 1989  In  presenting  requirements British freely that  this for  an  Columbia, available  permission  thesis  advanced  I  agree  by  his  or  partial degree  that  the  f o r r e f e r e n c e s and for  extensive  s c h o l a r l y p u r p o s e s may or  in  her  at  fulfilment the  copying  of  shall  this  It  thesis  be  a l l o w e d w i t h o u t my  Department of  i s understood  October,  permission.  I n t e r d i s c i p l i n a r y Studies  The U n i v e r s i t y o f B r i t i s h 1956 M a i n M a l l Vancouver, B.C. V6T 1Y3 Date  written  1989  Columbia  agree for  department  copying or p u b l i c a t i o n of t h i s t h e s i s f o r f i n a n c i a l gain not  of  make i t  I further  be g r a n t e d by t h e h e a d o f my  representatives.  the  University  Library study.  of  that shall  A B S T R A C T  Canada  is  a  g o v e r n m e n t s , one style  of  the  power  The  to  have  has  thesis  Situations  federalism and  and  changes  against  analyzes taking  the  how  place  development  transportation  which  u n i o n of  Canada.  The  thesis  are  of  transportation  policy within  structure  federalism.  analysis  of of  the  the  in  The  important  power  compared  example,  each  over  the  resource  base  as  this  features structure  the  national  the  Canadian  For  those  the  This  pose  special  government.  necessary  analyzes  eleven  that  such  in  of  exercise  policies.  control  examines  unique  increasingly  handicaps to e f f e c t i v e n a t i o n a l  This  provincial.  considerable  and  federal  government  economy.  ten  comprised  relatively  government  influence  provincial  and  is  provinces  federal  of . i t s  federal  federalism  aspects. to  confederation  to  of of  federalism  structure policies,  militates such  as  the  economic  development  of  national  framework of  the  changing  focus  sustain  Canadian  is  a  comprehensive  f e d e r a l government's p o l i c y to change  the  A B S T R A C T  Crow R a t e . of the  the  period  substantiate  paid  to  the  are  Jean-Luc Pepin,  sectors  and  period  matrix  how  a  taken  reach  arguments, by  with  emphasis  particular  which  Included  review of  interest  describe  existing  the  mechanisms  on  the  as  was  groups  federal-provincial  part  personal  compiled were  attention  of  the  analysis  working  papers  Access  somewhat  unique  a conclusion  to  show  how  affected  by  Model"  was  approach  for  on  of  1980-1983.  different Crow  these d i f f e r e n c e s influenced p u b l i c  "Inside-Outside  to  ten-year  M i n i s t e r of T r a n s p o r t ,  impact  c h a n g e and An  a  managed.  a time-series  An  over  between 1980-1983.  conflicts was  analysis undertaken i s a l o n g i t u d i n a l study  Crow R a t e  To was  The  Rate  opinion.  introduced Canada  to  that  was  Crow R a t e r e f o r m , g i v e n  the  constraints.  The  major  demonstrates federalism  and  contribution  the  ways  in  i n t e r e s t group  national policy. iii  of  the  which action  thesis the  is  that  combination  constrain  changes  i t of in  A B S T R A C T  The rooted  intensity in  the  important  type  additional defend often  and  provide  bestow  coalition  even  of  strategic on  the  force  areas of  iv  those be  the population for  of  of a  groups  an  mobilized  to  governments and  interest  their  protests  resistance  to  g r o u p s and  their  exclusive  s u c h as t h e Crow R a t e .  traditions  provincial  affecting  primarily  existence  can  leadership  interest  i s a potent  gives  that  be  the  the  Moreover,  the fears  legitimacy  in  system  well  and  but  government  of powerful  governments making,  society,  federal of  may  interests  interests.  reinforce  groups,  in  of  level  their  opposition  economic  groups  Canadian  of  change.  provincial  national  federal  A  policy-  jurisdiction  TABLE OF CONTENTS  Page Abstract Table o f Contents L i s t o f Tables L i s t of Figures L i s t o f Maps L i s t o f Appendicies Acknowledgements Chapter One: 1.0 1.1 1.2 1.3  Introduction Main I n s t i t u t i o n s o f Canadian P o l i t i c s Federalism Models o f Federalism Cabinet System Role o f t h e Central Agencies R o l e o f I n t e r e s t Groups Role o f t h e Media Framework f o r P u b l i c P o l i c y F o r m u l a t i o n  20 22 22 31 36 53 60 65 68  The Development o f N a t i o n a l Transportation Policy  Introduction The C a n a d i a n T r a n s p o r t a t i o n System Railway Ideology The C o n s t i t u t i o n and T r a n s p o r t a t i o n R a i l w a y Development Highway T r a n s p o r t a t i o n T r a n s p o r t P o l i c y Development  Chapter Four: 4.0 4.1 4.1.1  1 3 10 14  The Role o f P u b l i c P o l i c y Formulation i n t h e Canadian P o l i t i c a l System  Chapter Three: 3.0 3.1 3.1.1 3.1.2 3.1.3 3.1.4 3.1.5  Introduction  Thesis Approach Scope o f T h e s i s Context o f Thesis Synopsis o f Thesis  Chapter Two: 2.0 2.1 2.1.1 2.1.2 2.1.3 2.1.4 2.1.5 2.1.6 2.1.7  ii v vii viii ix x xi  82 83 85 89 95 115 123  Crow Rate as an Issue  Introduction Crow R a t e H i s t o r i o g r a p h y P e r i o d t h e Crows N e s t P a s s R a t e s were i n E f f e c t v  173 174 187  TABLE OF CONTENTS Page 4.1.2 4.1.3 4.2 4.2.1 4.3 4.4 4.4.1 4.4.2 4.4.3  R e p l a c e m e n t o f Crows N e s t P a s s R a t e s by S t a t u t o r y R a t e s I m p l i c a t i o n s o f t h e 1897 A g r e e m e n t P e r i o d o f U n c e r t a i n t y (1960-1980) The B o l d A p p r o a c h P e r i o d o f Change (1980-1984) The C o n f l i c t s Sectoral Differences Intergovernmental C o n f l i c t Intragovernmental C o n f l i c t  Chapter F i v e : 5. 5. 5. 5. 5. 5. 5. 5. 5. 5. 5. 5. 5. 5. 5. 5. 5. 5. 5.  0 1 2 2. 1 2. 2 2. 3 2. 4 3 3. 1 3. 2 3 .3 3 .4 3. 5 3. 6 4 4. 1 4. 2 4. 3 5  6.0 6.1 6.2  194 198 211 228 234 2 35 250 255  S t r a t e g y Development and N e g o t i a t i o n i n Canadian F e d e r a l i s m  Introduction Context Negotiation i n a Federal State P o l i c y F o r m u l a t i o n (The ' P e p i n ' Approach) I n t e r e s t Groups Role o f t h e Media C o n s e n s u s f o r Change Policy Negotiation i n a Federal State Appointment o f Federal N e g o t i a t o r P u b l i c A w a r e n e s s o f t h e Crow R a t e On-Farm A w a r e n e s s S t u d y G i l s o n Report I n t e r and I n t r a C o n f l i c t s Western T r a n s p o r t a t i o n I n i t i a t i v e Parliamentary Process Prelude t o L e g i s l a t i o n B i l l C-155 Western G r a i n T r a n s p o r t a t i o n A c t I n s i d e - O u t s i d e Access Model f o r P o l i c y Negotiation/Formulation  Chapter S i x :  190  267 268 270 270 276 281 285 300 300 309 313 321 327 335 337 338 345 356 357  Summary and C o n c l u s i o n s  Summary o f T h e s i s Conclusions Future Research  372 384 385  vi  L I S T OF TABLES  NO. 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23  Paae The L i b e r a l s i n S a s k a t c h e w a n , 1968-1988 R a i l w a y C o n s t r u c t i o n , 1906-1985 G r a i n H a n d l i n g and T r a n s p o r t a t i o n Trends 1930-1985 C h a n g e s i n A g r i c u l t u r a l S o c i e t y , 1960-1980 S t a t u s o f R a i l w a y M i l e a g e , 1975-1979 L i s t o f T r a n s p o r t a t i o n P r o p o s a l s made b y W e s t e r n P r e m i e r s a t WEOC ( 1 9 7 3 ) F e d e r a l Government T r a n s p o r t P r o g r a m s a n d P o l i c i e s E m a n a t i n g o u t o f WEOC ( 1 9 7 3 ) Federal-Provincial Committee on Western T r a n s p o r t a t i o n Committee o f M i n i s t e r s ' M e e t i n g - Agenda (1974) C h a n g e s t o t h e Crow R a t e A g r e e m e n t , 1897-1983 G r a i n E x p o r t V o l u m e a n d P r i c e , 1883-1985 The C a n a d i a n G r a i n P r o d u c t i o n , H a n d l i n g and T r a n s p o r t a t i o n S y s t e m , 1980 C o s t o f M o v i n g G r a i n b y R a i l 1974, 1977, 1980 Farm O r g a n i z a t i o n s and t h e Crow R a t e D e b a t e Membership o f G r a i n H a n d l i n g Cooperatives 1959 t o 1 9 8 1 Summary o f B a s i c P o s i t i o n s o n Crow R a t e , 1980 P e p i n P l a n f o r Crow R a t e R e f o r m R e g i o n a l D i s t r i b u t i o n o f Economic Impacts o f the Railway Investment Plans Financial Positions: Grain Handling C o m p a n i e s , 1980 Producer Guarantees P e p i n ' s C o m m u n i c a t i o n S t r a t e g y , 1982 Crow B e n e f i t Payment O p t i o n s Positions of Agricultural Organizations: M e t h o d o f Payment F e d e r a l O u t l a y 1982-83 t o 1985-86  vii  48 97 105 106 111 150 151 161 191 196 209 227 239 246 274 296 299 302 304 308 328 334 335  L I S T OF  FIGURES  No.  Page  1  Process of Cabinet Approval  59  2  F e d e r a l and P r o v i n c i a l P o w e r s  91  3  Branchline Rivalry  102  4  G r a i n and F l o u r E x p o r t R a t e s  182  5  G r a i n V o l u m e s and P r i c e o f Wheat,  6  Bulk Exports through the Mountains,  7  I n s i d e - O u t s i d e Access Model  viii  1974-1985 1960-1990  269 292 359  L I S T OF MAPS  Page  Crow's N e s t P a s s R a i l w a y  ix  183  LIST OF APPENDICES  An A c t o f P a r l i a m e n t t o A u t h o r i z e a S u b s i d y f o r a R a i l w a y t h r o u g h t h e Crow's N e s t P a s s - J u n e 29, 1897  The Crow's N e s t P a s s A g r e e m e n t ,  Compilation Newspapers,  September  o f E d i t o r i a l s from Major 1981-82  F e d e r a l Government P o l i c y S t a t e m e n t ,  06,  1897  Western  1982  An E x a m p l e o f A d v o c a c y A d v e r t i s i n g d u r i n g t h e Crow R a t e N e g o t i a t i o n s , M a r c h 30, 1983  The G i l s o n C o n s u l t a t i o n s and R e p o r t ,  x  1982  A C K N O W L E D G E M E N T S  A  thesis  researching level but  i s never and  the  writing  this  First,  really  I  acknowledge  number  willingness  t o t a k e on t h i s  patience,  of  Denise  drafts  I  me  acknowledge  guidance  I  person.  have  one  In  received  always  Jones of  who  this  a  hopes f o r  to complete  my  the  i n me  Her was  a  the undertaking.  thesis  and commitment  typed  thesis.  j o b and h e r b e l i e f  i n encouraging  Second,  that  one  expect.  countless  factor  of  thesis,  o f c o o p e r a t i o n and s u p p o r t  can never  major  product  Advisors  propelled  me  whose  t o c a r r y on  e v e n when t h e c h a l l e n g e seemed i m p o s s i b l e .  Third, whose this  I  acknowledge  inspiration  the  provided  me  Honourable with  t h e impetus  to  Pepin launch  project. Fourth,  I  acknowledge  Fred  standard  of i n t e g r i t y  identify  t h e l e s s o n s l e a r n e d from  Finally, the  Jean-Luc  I  became  acknowledge  transportation  made a v a i l a b l e d a t a  my  my  xi  objective changes  provided  o f my  whose  high  i n attempting to t o t h e Crow  colleagues  i n d u s t r y who i n support  Anderson  and  both  thesis.  Rate.  peers  from  insight  and  CHAPTER ONE  I N T R O D U C T I O N  1.0  T h e s i s Approach  The national  argument structure  development To  federalism  research about  formulation  The  thesis  a  in  longitudinal  government's  effort to  ( t h e Crow  and p o l i c i e s  Crow  the  transportation.  ten-year  on g r a i n  the  as  against  Rate  Rate).  used  enables  to the  o f a t r a n s p o r t a t i o n p o l i c y development model.  i n t e r e s t needs  groups  of p r o v i n c i a l  governments  a r e accounted f o r i n t h e model.  demonstrates that  process that  rate  t h e changing  militates  the strategies  changes  diverse  pressure  freight  into  i s that  p o l i c i e s such  t h e argument,  the r a i l  bring  and  thesis  i s undertaken of the federal  change The  of  of national  substantiate  study  of this  this  model  i s consistent  The  with the  s u c c e s s f u l l y b r o u g h t c h a n g e s t o t h e Crow R a t e .  Interestingly  there  have  been  - 1 -  no s y s t e m a t i c  studies  undertaken  of  i n Canada w i t h  national  transportation  an e m p h a s i s  Nor  have  there  been  the  process of p o l i c y  in  the  process  any  on  development  federal-provincial  studies  conflict.  undertaken which  development  itself  policy  showing  affected  how  outline  the  changes  transportation  policy  development.  The  thesis  transportation constraints the  of  provides a policy  issue  Canada's  style  interactive  federalism  systematic  effects  in of  study of a  Canada  showing  federalism  between  through the development  national  and  interest  examines  groups  of a p o l i c y  the  and  formulation  model.  The Canadian  thesis  federalism  characteristics national  In policy problems  outlines  the r e l a t i v e l y and  pose  unique  demonstrates  special  handicaps  f e a t u r e s of how  to  these effective  government.  support  of  initiative  the is  which confront  thesis,  a  undertaken Canadian  - 2 -  case to  study  of  a  demonstrate  federalism  major the  i n formulating  national  policies  i n the face  of c o n f l i c t i n g  provincial  interests.  In implicit  broader  i n a federal  difficult,  the fragmentation  s y s t e m makes c h a n g e  increasing  b e f o r e major the  terms,  the  new p o l i c i e s  political  system  level  i n Canada  study  thesis  provides  o f t h e Crow R a t e .  examining  the role  governmental which  more  required  and i n c l i n i n g  firmly  towards  an  adjustment.  against  Canada  government  ten-year  Paricular  negotiations.  transportation  governments,  a  of interest  t h e changing  militates  The  consensus  Scope o f T h e s i s The  to  authority-  i n g e n e r a l more  c a n be i n t r o d u c e d ,  incrementalist pattern of policy  1.1  of  of  longitudinal  emphasis  group  structure the  of  examines  t h e degree  Canadian  federalism  development  of  a  confederation  comprised  one f e d e r a l and t e n p r o v i n c i a l . h a s i t s own u n i q u e  jurisdictional  i n inter-  national  policies.  i s  Constitution  i s devoted t o  activity  The t h e s i s  case  Act,  1867  authority  of Each  eleven level of  p o w e r s and r e s p o n s i b i l i t i e s  gives  the  i n functional  - 3 -  provinces areas  unique  o f expanding  significance important, base  gives  of  The  and  in  centered national  control  shipping  of  on  health,  economy.  1867  course  as  them  their  navigation defined  such  was  as  provinces  size,  population  social  programs  and,  system. Concomitantly, as and  level  of  federal  since as  the  for  explicitly government.  Confederation  a  key  most  has  component  under  of  provincial  important  significantly  mode  in  is  geographical  structure,  devotion  i n Quebec, even a d i f f e r e n t  to  legal  transportation characteristics  competition,  commercial  the  economic as  resource  control.  vary and  natural  most  responsibility  evolved  arguably  not under e x c l u s i v e f e d e r a l  The  to  policy  Roads  Now,  and,  t r a n s p o r t a t i o n was  development  policy.  the  However,  transport  jurisdiction.  over  granted  railway  education  availability  viability  also  vary  of  such  infrastructure  significantly  from  province to province.  According Economic economic  Union and  development equity, However  of  to  the  and  Development  social  union  of  national policies  efficiency, the  Macdonald  cost  conflict  Royal  Commission  on  Prospects  f o r Canada,  the  Canada b a s e d on  depends factors  e f f e c t i v e n e s s and between  - 4 -  federal  and  on such  the as  rationality.  1  provincial  governments, national  which  policy  Confederation, difficult. and with  an  cooperation  h a s made  Today  economic  Canadian  decentralized  states. to  industrialized  a  for  broader  was  not resolved  and  except  with  than  i n a l l other  Switzerland.  a  and, as  initiatives  whenever  rationalize  or  province such  Act,  In turn  unless  resist  latter  government  1982.  is  that  As  well,  f o r economic  federal  i t s expenditures  there  government  attempting in a  to  particular  i s sound economic argument f o r  C a n a d i a n s have  respective  policy-making,  result, the  reduce  e v e n when  change.  their  a  The  confrontation  t h e p r o v i n c e s t e n d t o compete w i t h e a c h o t h e r development  h a s become  the federal  t h e Constitution  with  constitutional  i n Canada  powers,  goals  usually associated  perhaps  t o compete  jurisdictional  have  extent  since  of public  to that  greater  ingredient of  competition  provinces  Government  nations,  continue  enduring  t h e attainment  a u t h o r i t y equal  sovereign  provinces  has been  Premiers their  been  to  c o n d i t i o n e d by  resist  own p r o v i n c e  national  c a n be i d e n t i f i e d  as a w i n n e r .  The only  sharing  distinct  concurrent changed.  o f powers feature  basis The  between governments i s n o t t h e  of  Canadian  the public  Federalism.  policy-making  institutionalization  - 5 -  of  On  process  governments  a  has in  Canada, of  supported  growing  difficult  by p o l i t i c a l  significance,  the role  reduced  In addition  solidarity  at the federal  "regional"  ministers role  has  of governmental  in policy formulation.  traditional  and b u r e a u c r a t i c  level  with  has  that  has been  i s decentralized  local but  result  and r e g i o n a l  filled  t h e i r own j u r i s d i c t i o n .  raises  question  can  sustain  has  never  represents  The  t o develop  the  been  fully  realpolitik  by  state at the  decision-making,  This  provincial  "balkanization" of  the  federal  p o l i c i e s and programs o f Canada.  understood  i n this  once  provincial  input  of strong  ability  national  t h e economic u n i o n  by  This  that  situation  Canadians  yet i t  country.  c o n s t a n t p r o b l e m o f Canada's d i v e r s i t y o f r e g i o n s ,  interwoven with governments, the  of  this  of a federal  national  systems w i t h  government  that  n o t i n terms o f g r e a t e r into  the role of  p r o v i n c i a l Premiers.  more i n t e r m s o f t h e d e v e l o p m e n t  the  and i n d i v i d u a l s  today  the creation  levels  more  t h e concept of Cabinet  result  g o v e r n m e n t s o r , more s p e c i f i c a l l y ,  The  groups  made  has changed  the  been  or  entities  current  the ever  t h e changes debates  on  increasing  ambition of p r o v i n c i a l  i n the structure free  trade,  energy  o f labour and  t r a n s p o r t a t i o n p o l i c y deserve close examination.  - 6 -  and  national Resolution  of each o f these cooperation issues the  areas  and a g r e e m e n t .  has begun ten  t o focus  provinces  federal-provincial demonstrated positions goals are  requires  that  as  question  on-going b a s i s , w i t h  Richard  the that  Simeon's  has  classic  on a d i v i s i o n o f  government  i s responsible  been  model  labour  free  to  imbalance  criticize  government  is  provincial  transportation  argued  reluctant  i n this  and e n e r g y but  i n which issues  thesis,  policies  to  have  policies  are equally  a  transon  the  and t h e u n i t  Provinces  but  the  similar  which,  there are  central  voice  in  will  be  as  relevant  is  federal  I n Canada  2  an  years.  federalism  i n the process.  federal  regional  discussed  of  for national  also  as p r o v i n c i a l  agenda  governments f o r l o c a l / p r o v i n c i a l i s s u e s . a fundamental  and  emotion, f o r over a hundred  predicated  is  have  of free trade  public  among  traditional  debates  represented  The i s s u e s  goals  the  i s i n decline  t o be  on  to  The  regionalism  issues  is a  on t h e c o n f l i c t i n g  conflict.  and o b j e c t i v e s .  portation  The d e b a t e o v e r e a c h o f t h e s e  compared  a r e more l i k e l y  irregular  renewed f e d e r a l - p r o v i n c i a l  to  national  economic development.  To e x a m i n e t h e t h e s i s complex  regional  problem,  i t was n e c e s s a r y within  - 7 -  the  to focus  area  of  on a  federal  jurisdiction,  which  required  through  which  benefit  economically  federal  initiative  generated  in  the  provinces yet  Canada's  move g r a i n  and a  by  perspective,  b e t w e e n 1980 was  and  d e b a t e d and  The grain  for  new  (a  in  in  1925)  grain  Crow R a t e was  on  the  diversification impediment prairies;  to and  federal  fixed  rail  1898  and  in  the  railways; of  the  (2)  1899  further finally  being  government  an  a  rates  complex provides  the  period  Crow  on  Rate  export  confirmed  transportation  of  an  inhibiting  by  costs  l o n g e v i t y of  transportation  (1)  the and  ever-increasing factor  a g r i c u l t u r a l sector  processing (3)  on  rate  and  However t h e  western  freight  enacted.  freight  world  federal  thesis  i s placed  stable  an  The  such  this  the  pressures  over which the  represented:  p u b l i c p u r s e was  ad hoc  period  producers.  continuation  burden  Although  provided  unique  of  Crow R a t e ) was  emphasis  the  opposing  federalism. level  policyactually  political  legislation finally  introduced  prairie  its  1983,  Crow R a t e  Parliament  the  of  i n t e r - p r o v i n c i a l issue.  historical  the  in  would  themselves  change the (The  change  affected  of  style  rail  major  find  because  government's d e c i s i o n to to  a  activities  for and in  the an the  i n v e s t m e n t vacuum i n t o w h i c h  drawn deeper subsidies  programs.  - 8 -  and  and  deeper  capital  through  investment  Despite resolution varying  the of  overwhelming  the  Crow  degrees  economic  Rate,  by  all  change  three  was  hardly  -  federal  find  The  a way  to  "regional" given  with  the  this  economic  problem  the  problem of  problems the  years  to  federal  come.  a t t e n t i o n on  the  resolution  of  the  of  the  to  p o l i c y on  of  Crow  be  learned  interest  to  the from  the  state.  Crow and  be  assess  the  As  o f many  facing  important and,  to  context  one  document  transport  decision-makers  national  federalism  to  i t all  political,  federal  is  Rate,  grain  a  government w i l l  c o n s t r a i n t s w e r e a d d r e s s e d and reform  complex,  the  i t  by  g o v e r n m e n t was  Crow R a t e i s b u t  Therefore  constraint  in  in  provincial  affected  serious,  existing constraints  indicated,  the  deal  and  the  similar  conundrum of  for  resisted  prairie  governments i n c l u d i n g a p r o v i n c e Quebec.  arguments  to  focus  through how  The  Rate  debate  will  those  affected  the  these  impact of  sector.  in  the  lessons be  of  by  national  Rate  requires  policy.  To  understand  knowledge of the in  which  crucial t o d a y and  the  issue  geographical  of  reality  territorially-derived  to  the  will  economic be  so  union  i n the  the  of  -  of  issues  future.  - 9  Crow  Canada. are  Canada.  The  resolved This  is  ways is true  1.2  Context  of Thesis  Canada  is  represents  the  comprised such,  of  only  suitable around  provides popular  agriculture.  of  more  much  per  of  During  the  regions  The  prairie  region  a  region  where  from  past  been  farmers  the s e r v i c e sector  three  now  Contrary  to  "bread-basket  and  farms,  per cent 3  western declining  productive "Today  Product  i s not  to  farm  growth primary  i i s 7.1  i n S a s k a t c h e w a n and  This  - 10 -  of i t s  increasing  substitution.  share of Gross P r o v i n c i a l  in Alberta".  decades  c h a r a c t e r i z e d by  considerable  capital-for-labour  cent  are  i s i n southern  a l l employment.  the  has  16.6  as  grows o n l y b e t w e e n 4 and 5 p e r c e n t  specialization,  i n Manitoba,  and,  country  w h e a t p r o d u c t i o n and o n l y 3 p e r c e n t  full-time  is  i s Canada's prime  1 land  crops.  t o one w h e r e  Canada  agriculture  agriculture's cent  which  It  region which produces n e a r l y a l l  two-thirds  grains.  numbers  and  the  p e r c e p t i o n , p r a i r i e Canada i s n o t t h e  Canadian  size,  divisions  include  the Class  territory  world.  of  These  transformation  over  i t s  the  areas  g r a i n and o i l s e e d  the world".  coarse  in  of Toronto,  dominated  and  physical  southern  region - half  of the world's  4.5  most  undergoing  agriculture  of  different  - and t h e p r a i r i e  Canada's  country  largest  the conurbation  Ontario  is  many  for  immense  second  the  agricultural  of  an  state  per only that  grain  production  billion of  i n annual  Canada's  export  i s not important  agriculture constitute  sales i s significant  major  trade  t o Canada  sources  Based  of  a declining  a n d r e p r e s e n t s one  of c o n t r i b u t i o n t o a  situation. sector  - i t i s - $5  on t h e above  the  prairies  balanced  trends, the  will  steadily  proportion of the p r a i r i e  region's  output.  The  population  million)  represents  whereas  approximately  reside  about  16  weight  i n one a r e a  i n national  eastern  and  political struggle  increased p o l i t i c a l  During politics,  the including  that  provinces of  greater  Central shares  autonomy".  1980s  stand  i n Canada  core  region As  ofthe  considerable such  as  Canada*  "...the  peripheral and  must  o f n a t i o n a l w e a l t h and  4  "...much  of  current  Canadian  t h e C o n s t i t u t i o n issue, turned  of the provincial  four  the nation,  This  decision-making.  dependencies  of  o f t h e people  corridor.  has g i v e n  western  to obtain  (approximately  per cent  50 p e r c e n t  i n t h e Quebec-Windsor  population  attempts  of the prairies  level  political  on t h e  communities t o  *The term Central Canada is consistently misused. The economic heartland of Canada is really the Toronto umland which is a small proportion of Central Canada (Ontario and Quebec). Even the Quebec City - Windsor axis no longer is a contemporary description of the industrial base of Canada.  - 11 -  gain  more power o v e r  all,  the benefits  comitantly, Canadian some  provinces  provincial  natural  procurement  have  policies.  tendering  provincial  Two  narrow  national  that  There of  The  a r e no d i r e c t  Atlantic  contrasting  Canada  considerably significant  a i rlinks with  to  their  "the c r i s i s  of  i n the relations  between  Act  (1967)  - 12 -  to  Toronto/Montreal. cities  of the four  of competition  This  the policy which  i t applies  services  Canada.  from  as  cities  infrastructure  departures  Canada's  the capital  t h e degree  throughout  to  i s no n a t i o n a l b u s  to  the capital  Thus  of  Transportation  There  means V a n c o u v e r  provinces.  availability  access  outside  features  "transcontinental"  and a i r l i n e s  western  National  many  term  actually  7  t r a n s p o r t a t i o n system.  company. railway  are  "...seven  have  suppliers  states  another  province-first  inhibit  C a n a d i a n f e d e r a l i s m i s above a l l a c r i s i s  There  with  governments  Simeon  between g o v e r n m e n t s " .  the result, i n  trade  that  Con-  between t h e  F o r example  adopted  f o r Canadian  Richard  6  with  to  restrictions  contracts  links  been e r o d i n g  another province.  more i f n o t  resources".5  economic  i t i s easier  governments  provinces".  their  have  that  than with  imposed  from  economies, t o g a i n  the traditional  cases,  country  their  and  varies  has  caused  contained  i n the  emphasized  efficiency  and e c o n o m i c  The in  competition.  Crow  t h e 1980s.  Prime  debate  reached i t s greatest  intensity  D u r i n g t h a t p e r i o d Canada had f o u r d i f f e r e n t  Ministers  affected and  Rate  and i n t h e P r a i r i e s ,  b y Crow R a t e  Saskatchewan)  changes,  changed  an e c o n o m i c c r i s i s ,  the region  two g o v e r n m e n t s  hands.  The c o u n t r y  an e n e r g y c r i s i s  most  (Manitoba also  faced  and a c o n s t i t u t i o n a l  crisis.*  It  i s against  this  background that  analyze  t h e f e d e r a l government's  Rate.  According  Wallace  "...case  identifying  to  studies  conditions  make  the process  well  a s more a b l e  Frederick  more  J . Fletcher some  and s u g g e s t i n g  t o manage  thesis  will  p o l i c y t o c h a n g e t h e Crow  provide  decisive,  this  Donald  guidelines  reforms that  and more  conflict".  and  in  might  responsive,  as  8  *In the early 1980s, the deficit was high, growth was sluggish, productivity was poor, there existed excess capacity and inflation and unemployment were high. In terms of energy, the spot-price of oil at Amsterdam was $50.00/barrel. A National Energy Policy was established. The multi-national oil companies opposed an annual increased tax on net revenue and the provision which could result in more Canadian ownership. It was also during this period of time that Canada was addressing constitutional issues such as the non-existence of a written constitution or an agreement on an amending formula or the sharing of powers between the federal government and the provinces.  - 13 -  1.3  Synopsis of Thesis  To be  demonstrate  paid  to  conflicts or  the  first  of  and  provincial  ministers'  media.  These  The  longitudinal  basis,  institutions  affected  the  early  examined  1970s. as  politics include  provide the  each  of  federal-provincial  which  national  interest  of  the  institutions  affect  public  o f how  Rate  parties,  groups  thesis  analysis Crow  will  the Cabinet system, the  caucuses,  part  Each  which  attention  a r e many m a j o r  conference,  research  particular  by  There  Canadian  development.  federal  thesis,  mechanisms  a r e managed.  mechanisms  policy  this  debate  and  will,  had  a  major  the  over  each  a  of these  beginning i n  of these i n s t i t u t i o n a l f a c t o r s  them  the  influence  on  were the  o u t c o m e o f t h e Crow R a t e d e b a t e .  C h a p t e r Two building, provincial positions decline  with  will  discuss  particular  governments, of  each  of  reference and  these  to  document  the how  governments  o f t h e c o n c e p t o f a more g e n e r a l  as a f o c u s f o r e c o n o m i c  The the  the development  role  other of  major a  policy  prairie  different  demonstrates "prairie  the  region"  planning.  Cabinet  - 14  province-  three the  i n s t i t u t i o n a l factor  federal  of  -  Minister.  discussed  was  Since  the  Transport  Minister,  such a predominant his  role requires  Chapter policy  central  also  planning  Pepin,  played  t h e Crow R a t e  debate,  analysis.  the  emphasis  on  cooperative,  model.  Jean-Luc  i n resolving  outlines  with  s u c h as  Also  executive  and  of  public  t h e c h a n g i n g models  included  processes  evolution  i s an  and  the  analysis  structures  which  of  current of  the  affected  Crow R a t e d e b a t e .  Chapter national the  Honourable  critical  Two  collaborative  the  role  development  federalism  The  Three  transportation  constraints  federal  presents  that  government  an  policy.  Canadian to  historical The  chapter  federalism  pursue  review  emphasizes  imposes  effective  of  on  the  transportation  policy.  Chapter  Four  introduces  I t p r o v i d e s an h i s t o r i o g r a p h y it  outlines  government provinces  The analyzes  the and  diverse the  and b e t w e e n  most  Crow  Rate  as  an  issue.  o f t h e Crow R a t e p r o b l e m  conflicts  between  federal  between  the various  socio-economic sectors.  chapter  government's  - 15 -  is  and  the  and  provinces,  important  the f e d e r a l  the  Chapter  approach  among  Five.  the  It  t o overcome t h e  constraints issue. the  federal  where  the  There  federal  this  of  is  government  chapter  federal  in  Minister  of  the  the  conflicts  establish  its  to  implement  change  no  electoral  emphasis  (Transport  debate.  The  about  a  affecting  change  in  on  a  one  The  a  region  Throughout  the  role  in  primarily  within  r o l e of  Minister  advocacy  Rate  strategy.  support.  i s placed  Crow  a  Jean-Luc  of  a  federal  Cabinet area  region,  of  deserves  attention.  The  evolution  de-emphasize traditional filled  by  analyzes  the  of  utilized  and  i n the  formation which  in  has,  role  in  analyzes  also  e m e r g e d , may  serve  important  showing  the  The as  been  section  in  includes  to This  times,  alternative  debate.  tended  ministers".  Premiers  state the  Crow R a t e  d o c u m e n t s t o be  of  has  recent  This  Five  federal  federal-provincial  The  "regional  Chapter a  solidarity  Premiers.  increasing  development.  Parliament  of  role  provincial the  Cabinet  concept  advocacy  negotiation  future  to resolve  to  Minister  bring  jurisdiction, special  had  special  this  to  state  examination  virtually  Cabinet  Pepin)  on  an  government  i t had  policy  federal  national a  section role  of  approaches  approach  a guide  to  support  the  to  policy  resolving  conflicts.  employed  - 16  -  to  analysis  in  Chapters  Two t o F i v e w i l l  of  t h e personal working  Transport, various  Jean-Luc  Memoranda  departmental in  a  technical involved  papers  Pepin.  o f t h e former  Included  t o Cabinet  briefing  Federal  i n c l u d e a t i m e - s e r i e s review  State"  position  notes  The c h a p t e r  i s supported  papers  i n this  working  notes.  Minister of  by  and  with  inter-  on " N e g o t i a t i o n  a  review  o f a l l t h e major  i n the discussions,  review are  of the  participants  Dr. Clay  Gilson, the  f e d e r a l l y appointed negotiator.  The c o m p l e x i t y a n d t h e o p i n i o n - o r i e n t e d n a t u r e o f t h e research Public  material  lends  o p i n i o n was  various  surveys  sectors how  impact  assessed  undertaken  a survey undertaken  An  itself  through  these  i s compiled  differences  negotiation Crow R a t e  Model  approach  b y Crow  groups,  taken  t o reach  Case  how  Rate  public  i s developed  given theexisting  Rate  approach.  analysis  t o show  influenced  of the including  different  changes and  opinion.  to explain  a  An  unique  a c o n c l u s i o n on t h e  constraints.  The Inside-Outside Access Model Crow  study  by t h e author.  matrix  Access  an  by d i f f e r e n t  and g r o u p s were a f f e c t e d  Inside-Outside  the  t o a case  i s a helpful  Study  - 17 -  and  framework f o r  might  be  used  to  examine  other  national  development of r a i l w a y  transportation  safety  legislation.  - 18 -  policies  such  as  NOTES  JRoval  Page 1 of 1  Commission on the Economic Union and Development Prospects for Canada. Vol. 1, University of Toronto Press, Toronto, 1985, pp. 46-57.  ^Richard Simeon, "Confrontation and Collaboration - Intergovernmental Relations in Canada Today", The Institute of Public Administration of Canada. Toronto, 1979, p.2. 3M.M.  Veeman, "Western Canadian Agriculture: Prospects, (Problems and Policy), Canadian Public Policy, Vol. XI, Supplement, 1985, pp.301-302.  ^C.F.J.  Whebell, "Geography and Politics in Canada" in Approaches to Canadian Politics, edited by John Redekop, Prentice-Hall, Toronto, 1983, p. 26.  5  Ibid. p. 26.  6Larry  Grossman, "Regionalism 1980, p. 180.  Run Amok", Canadian Business. September,  ^Richard Simeon, "Intergovernmental Relations and the Challenges to Canadian Federalism", Canadian Public Administration. Vol. 23, 1980, p. 14. ^Frederick J. Fletcher & Donald C. Wallace, "Federal- Provincial Relations and the Making of Public Policy in Canada" in Division of Powers and Public Policy, (Vol. 61), edited by Richard Simeon for the Royal Commission in Economic Union and Development Prospects for Canada, University of Toronto Press, Toronto, 1985, p. 129.  - 19 -  CHAPTER TWO THE  2.0  ROLE OF PUBLIC POLICY FORMULATION IN THE CANADIAN POLITICAL SYSTEM  Introduction This  political policy  chapter  outlines  system  and a n a l y z e s  formulation.  political  The  institutions,  the structure its  o f t h e Canadian  influence  chapter  shows  i n conjunction  on  how  with  public  Canada's  established  i n t e r e s t groups, can severely c o n s t r a i n n a t i o n a l d e c i s i o n making  i n p a r t i c u l a r ways.  In later  chapters,  the thesis  d e m o n s t r a t e s s p e c i f i c a l l y t h e ways i n w h i c h t h e c o m b i n a t i o n of  federalism  and i n t e r e s t groups'  change i n f e d e r a l  It a  interests  the intensity of opposition to  defend  their  the traditions  But t h i s  thesis  provide  bestow  o f government t h a t  interests.  reinforce  groups,  be p r i m a r i l y  rooted  of  will  Moreover,  the fears  legitimacy  c o a l i t i o n of powerful  provincial  leadership  on  - 20 -  those  groups  governments and i n t e r e s t  f o r their  the resistance  i n t e r e s t groups  that the  c a n be m o b i l i z e d t o  of the population  strategic  i n the  independent  show  o f Canada's f e d e r a l system p r o v i d e s  additional level  often  and  i n society.  existence  and  that  p a r t i c u l a r p o l i c y , may w e l l  groups  an  policies.  c a n be a r g u e d  economic  inter-action constrain  protest,  t o change.  A  and t h e i r p r o v i n c i a l  governments even,  is  as w i l l  exclusive  a  potent  force  i n national  be d e m o n s t r a t e d i n t h i s  federal  government  policy-making  thesis,  jurisdiction  i n areas of  s u c h as t h e Crow  Rate.  In  specific  institutions in  policy  explored  terms  this  of Canadian  Politics  development. with  a  chapter  The  strong  reference  The  models  particularly  federalism  in  terms  of  towards  the  national  transportation  its to  determine  with  other  groups  how  arms,  the  such  as  assesses t h e i r  role  of  of  the  The  central  special  interest  of  being  of  is of  working executive  an  impediment  and  effective  agencies,  groups  theme  three  Cabinet  interplay  governmental  the  t h e model  efficient  policy.  federalism  to  concept  these groups  similar  main  applicability  development  bureaucratic  the  concept  "province-building". are discussed,  and  examines  system is  with  examined  with  each  other,  and  with  other  organizations  and  the  media.  The  role  of s p e c i a l since  interest  also  examined  both  these  roles  i n t h e Crow R a t e d e b a t e .  - 21 -  groups groups  and t h e m e d i a played  are  important  2.1  The  Main I n s t i t u t i o n s of Canadian  This  section  Canadian  politics.  "federalism" important is  discusses The  with  cooperative,  first  main  The  with  historical  reference  executive  and  to the  institutions  institution  province-building  theme.  reviewed  the  Politics  discussed  appearing  e v o l u t i o n of three  is  as  an  federalism  analytical  current  of  models:  collaborative  form  of f e d e r a l i s m .  2.1.1.  Federalism  Canada the  is  classical  powers  to  reflect Canada.  federal  govern.  the  state.  definition,  Canada  and  is  a  Federalism  the  This  1  complex  g o v e r n m e n t s , one  The  a  territorial  simple  form  Confederation and  power t o make l a w s  ten  of  i n Canada  are  of  powers from  are a  (1867).  review  of  powers  In that Act  contained  in the  the  Sections federal  - 22  does  not  federalism of  given  The  Constitution Act  of  in  eleven  provincial.  to the ten p r o v i n c i a l  division  division  comprised  n a t i o n a l g o v e r n m e n t and initial  in  definition  confusing  federal  implies,  -  is  to  93.  powers  a  governments.  contained  federal 91  to both  and  in  the  provincial It  that  is i t  clear was  intended greater to  that  the  power.  central  Section  government  have  the  the federal  government  "...make l a w s f o r t h e P e a c e , O r d e r a n d g o o d  Government  2  91 a l l o w s  should  o f C a n a d a " , and t h i s w o r d i n g 1867 In  intention addition  power  i s often  to establish  the central  to disallow  c i t e d t o support the  a strong  government  or overturn  central also  government.  was  any p r o v i n c i a l  given  the  law that i t  d e c i d e d was n o t i n t h e i n t e r e s t o f t h e c o u n t r y as a w h o l e . This  power  92:10 in  has n o t been  the federal  government  transportation  roads,  canals  interest  railways  so.3  since was  including  and  t o do  used  1943.  given  immense  the takeover i f i t were  i n 1867 Canada  Under  of  was  changing  an u r b a n i n d u s t r i a l s o c i e t y  for  government  governmental Christopher  conflict  was  Armstrong  i n detail  Ontario"  and t h e f e d e r a l of  governmental either  By  established  the early  private conflict  rural  and demands  as  early  The Politics  conflicts  of i n t e r as 1 9 0 5 . of  Federalism  between  "Empire  g o v e r n m e n t , a n d he d o c u m e n t s t h e interests  as  in  rival  i n O t t a w a o r Queen's  t h e 1930s  national  of the century i t  The p a t t e r n  i n h i s book  outlines  "...role  By t h e t u r n  increased.  provincial  was a l a r g e l y  economy.  services  authority  i n the  primary-producing into  Section  Park".  the provincial  - 23 -  provoking  parties  sought  intersupport  4  governments  were  faced  with  enlarged  Depression these by  responsibilities  but  limited  financial  responsibilities.  using  Thorburn  jurisdictions l e v e l s of  unitary deeply  of  competing  policy  government."  after  during  entrenched.  province-building determined in their  responded  out  but,  as  f o r the  Hugh  somewhat  overlapping  initiatives  1939-45  move  World  towards  Probably has  6  government  today:  been  the  by  the  War,  governed  and  two  for  a  as  a  almost  province-building most  written  t h a t t h e p r o v i n c e s had  favour".  discharge  laid  t h e c o u n t r y was  the  the  5  the  t h e war,  state,  was  of  to  help  situation and  Although  to  ground  out  capacity  federal  power  "...the  unsatisfactory  period  The  i t s spending states,  arising  quoted  by  Alan  article Cairns.  numerous f a c t o r s  was on He  working  These were:  1.  Impressive c o n s t i t u t i o n a l responsibilities i n areas of expanding government c o n c e r n , notably, welfare, e d u c a t i o n , h i g h w a y and n a t u r a l r e s o u r c e s .  2.  A d m i n i s t r a t i v e competence years.  3.  Jurisdictional government.  It  was  this  federalism  growth in  control  improved  in  the  growth  of  in provincial  Canada.  Garth  - 24  powers Stevenson  -  that  the  postwar  areas  of  transformed  believes  this  growth of t h e s t a t e the  modern w o r l d .  at the sub-national  level  i s unique i n  As a r e s u l t :  ...provincial governments themselves now possess impressive means of complicating, frustrating and interfering with policy m a k i n g a t t h e f e d e r a l l e v e l , means w h i c h t h e y are f a r l e s s h e s i t a n t t o use than t h e f e d e r a l government i s t o employ i t s v i r t u a l l y a b a n d o n e d power o f d i s a l l o w a n c e . 7  The the  g r o w t h o f p r o v i n c i a l i s m h a s h a d a m a j o r i m p a c t on  concept of p o l i t i c a l  regionalism  documented by Roger G i b b i n s . no  longer  possible  regionally distinct phrases their  Emile  impel  the  believes  that  that  population behavior.  territorial  nature  of things  elsewhere  He  asserts  to detect, that  surrounding  refers  on t h e p r a i r i e s  according  i t i s the p o l i t i c a l social  and  t o t h e 1966 " k e y n o t e  Canadian  federalism  by  Black  economic article" and  - 25 -  of  a r e becoming  to Gibbins. system  lose  i n the  between t h e  and t h e n a t u r e  Canada  a  para-  divisions  Significant differences  i n English-speaking  harder  also  9  i t is  towards  s i g n i f i c a n c e as t h e y become " . . . l e s s g r o u n d e d of t h i n g s " .  the  Gibbins  8  s t y l e of p o l i t i c a l  Durkheim  nature  and  to  i n w e s t e r n C a n a d a , as  things harder Gibbins  1 0  that  molds  environments.  He  on t h e e v o l u t i o n  of  Cairns  to  support h i s  argument  that  "...political  inevitable  consequence  and  standards  rising  Black  and  leaders  expressions outlooks". absence  of  Cairns  have  and  makes  with  the  the  provincial  boundaries  this  the  evolved  to  Canadian  t h e s i s documents  debate of  in  been  and  the  thus  giving regional  that  the in  near  western  along  the  lines  the  effect  of  reduce  the An  manner provides  of this  r e g i o n a l i z a t i o n of  important  in  has  which  support  finding  the to  Crow  the  of Rate  argument  Gibbins.  Another Canada  at  that  countries".  been  have 1 3  for  expense  have  would  Gordon  reason  the  governments  A  of  decline  former notes  implementing  a  in  regionalism  provincialism is  allowed  been  Robertson,  the  to  get  considered Secretary that  national  to  away  the  1  -  actions  in  tends  other  Cabinet, "...to  effectiveness in defining  interest". ^  - 26  with  Federal  action  in  "...provincial  outrageous  such  u n d e r m i n e O t t a w a ' s l e g i t i m a c y and and  and  strong governments,  that  west.  Gibbins,  distinctive  institutions  regions and  to  shaping,  argument  growth of  prairie  has  the  an  institutions  in  the  political  fragmented  fragmentation  role  not  industrialization  "...political key  is  According  1 1  perpetuating  regional  Canada, c o u p l e d  living".  a  Gibbins  1 2  urbanization,  argue  played  to  of  politics  of  integration  Richard  Simeon  supports  t h i s p o s i t i o n b e c a u s e he  suggests:  " . . . t h a t there i s a fundamental imbalance in the process. P r o v i n c e s are f r e e to c r i t i c i z e f e d e r a l p o l i c i e s but Ottawa i s prevented from a similar voice in provincial education policies which, i t could be argued, are equally relevant to n a t i o n a l economic and c u l t u r a l development". 1 5  Cairns arrest  raises  concern  the imbalance.  He  over  what  can  be  done  to  states:  "...the provinces in Canadian federalism, especially those which combine w e a l t h and resources with impressive jurisdictional c a p a c i t y , a r e more p o w e r f u l t h a n t h e s t a t e s o r p r o v i n c e s o f any e x i s t i n g f e d e r a l s y s t e m . They are more p o w e r f u l than most o f the member s t a t e s o f t h e U n i t e d N a t i o n s " . 1 6  The  significance  national the  policy  views  Canada's devoted  of  levels:  eleven  and  federal  and  concept  effort and  supportive  above  must  to  of  This  resolving  policies  into  policy  provincial,  of  statements  take  governments.  p r o v i n c i a l p r o g r a m s and other  the  development  historical time  of  is  that  consideration  is  contrary  development issues  assuming  to  which  between  two  that  a l l  were c o n s i s t e n t w i t h  each  national objectives.  Indeed,  as  Richard has  Simeon  always  other.  been This  1 7  discussions federal or  ation  to  attack  has  as  a  "Ottawa"  tended  contest  to  spokesmen  representing  submitted  In  reviewing  and t h e  i n t e r e s t groups, when m a k i n g  on a s p e c i f i c  Commission  f o r Canada  on  1,000  Briefs  Dartmouth  Trade  and  such the  Chamber o f Commerce, t o e x p r e s s a l i e n a t i o n o f t h e region"  instead  benefits  of  interest  groups  of t h e i r  Confederation. adopt  S a s k a t c h e w a n Wheat P o o l the  respective  "consideration  Pressure  the  same  approved  Thorburn  1 8  examination part  of  i s supported  "...listening  groups  "Maritime  strategy.  or In  i f the federal  special 1969  the  government  t o t h e problems of Western  concluded  perceives  Moncton  from t h e economic  that  as a r e s u l t o f h i s  t h e B r i e f s t o t h e Macdonald  o f Canada  conclusion  1 9  as t h e  a resolution calling for  of secession  d o e s n o t g i v e due c o n s i d e r a t i o n Canada".  city  Union  Hugh T h o r b u r n  Halifax  of  represent-  Economic  (1985),  to  alleged  i t was common f o r o r g a n i z a t i o n s , Board  tend  or  observed that and  each  intergovernmental  approximately  t o t h e Macdonald  than  t h e p r o v i n c i a l governments,  government  Development P r o s p e c t s  rather  provinces  the provinces  the concept of "regionalism" to the federal  of the  focus  between  In turn  grievance.  and  out, the strategy  government.  other  invoke  points  itself  as  by R i c h a r d  a  net winner.  S i m e o n who  to a l lthe grievances,  - 28 -  Commission  one  pointed  sometimes  no  This out gets  the  impression  Confederation benefits basis  that balance  of  sheet".  Confederation  n o t on a r e g i o n a l  attacks  the concept  regions  in  constructs".  of  i s so  a r e measured  are  on  He  i n the  because  the  a provincial  scale.  regionalism.  He s t a t e s  'losers'  J.E. Hodgetts has  essentially  argued  that  "bureaucratic  that:  2 2  This  raises the question  regionalism  is  provincialism Cairns  This  2 0  or national  Canada  2 1  are  "...regionalism, a t a n y l e v e l one w i s h e s t o take i t , does not generate spontaneous demands that thrust themselves on the political system and are instrumental in i n f l u e n c i n g the p o l i c y outputs of t h e system. The region i s n o t ' s o much t h e c r e a t o r o f p o l i c y as t h e c r e a t u r e o f p o l i c y " .  1  2 3  ,  as  political  valid  Today loosely  to  govern  become  or  has  the concept of  the  defined  the capacity the  the  concept by  focus  and  of p r o v i n c i a l  interests  new  Black  of  of  regional  of  a  more  federation?  national  integrated  distinct  today  "...strengthening  systems  decentralized  as t o w h e t h e r  or province-building,  communities...",  ten  a l l regions  policies  must  bind  s e c t o r i a l economies  provinces,  each w i t h  29 -  together over  their  own  a  several  network  economic  of and  social the  development  term  region to  "regional"  i s limited  the  Maritime  prefers Other  t o be  i s quite  the  regional  to  of  "sectorial"  i n the Canadian  context.  region  are  Ontario,  refers It  provinces.  Hodgetts  reveals  how  when  applied  across the  use term  Prairies  and  a l l the  the  I f one  the as  to  Newfoundland.  quickly  we  and  points  2 4  exhaust  nation.  p r o v i n c e s would  boundaries north to include  In  prefer  the Yukon  and  Territories.  Macdonald federal  Stevenson  omit  but  of the four A t l a n t i c  n o r t h e r n Canada,  The  must  This nomenclature  concept  t h e N o r t h West  between  one  Quebec,  typical  extend t h e i r  temptation exists  i n p l a c e of  Columbia.  out  The  known as one  regions  British  terms  plans.  and  Commission  recognized  the  provincial  governments  and,  conflict as  writes:  "...this has been an enduring feature of Canadian political life f o r more than a century. I n d e e d i t h a s b e e n so u b i q u i t o u s t h a t i t t e n d s t o be t a k e n f o r g r a n t e d o r t r e a t e d as synonymous w i t h f e d e r a l i s m r a t h e r t h a n as a d i s t i n c t phenomenon t o be a n a l y z e d , i n i t s own r i g h t " . 2 5  Consequently, according to Stevenson: " . . . t h e r e has b e e n no systematic study of federal-provincial conflict and not much a t t e n t i o n has been p a i d by s t u d e n t s o f t h e p o l i t i c a l s y s t e m t o t h e mechanisms by w h i c h f e d e r a l - p r o v i n c i a l c o n f l i c t s a r e managed and resolved". 2 6  - 30  -  Garth  This analyzing Crow  thesis  t h e mechanism  Rate,  between  with  group  and p r o v i n c i a l  The  next  government  address  this  on  the  action  void  by-  to resolve the  interaction  effects  and t h e c o n f l i c t  between  governments.  section  i n Canada  to  and p r o c e s s e s u s e d  emphasis  interest  federal  attempts  discusses  interact  how t h e two l e v e l s o f  t o develop  and  implement  policies.  2.1.2  Models o f Federalism  From describe power  federalism  between  separate the  levels  and o v e r - l a p p i n g  for  of t e r r i t o r i a l  of  administrative  cooperation  period  federal-provincial  establishment  of  as  each  having  The e v o l u t i o n  of  has i n c r e a s e d t h e i n t h e development  b e t w e e n 1920s t o t h e 1960s d i d r e s u l t i n  considerable  and,  d i v i s i o n of  government,  state  to  policy.  The  expense  f a r i t i s possible  jurisdiction.  federal-provincial  public  so  as a k i n d  the  modern C a n a d i a n  need of  the discussion  t o both a  many  shared-cost  the federal  result,  cooperation  t h e term  programs  and p r o v i n c i a l cooperative  - 31 -  and  ( a t great  public  federalism  the  purse) i s used  to  describe  period. can  intergovernmental  Basically  not d i c t a t e  techniques However,  were policy  diplomacy,  i t must with  federal  i t reflects  federal use  and s p e n d i n g  One  of  the  of  that  time  " . . . t h a t Ottawa  r a t h e r i t must  persuasion  be p o i n t e d  during  the view,  to the provinces;  of  undertaken  relations  rely  and c o n s u l t a t i o n . "  out that the i n i t i a t i v e s  leadership. taxation,  on  The  were  techniques  expenditure,  2 7  used  monetary  power.  strongest  practitioners  f e d e r a l i s m was J e a n - L u c P e p i n .  I n 1964 he  of  cooperative  wrote:  " . . . t h e r e s h o u l d be no q u e s t i o n o f o p p o s i n g cultures, languages and ' n a t i o n s within Canada. We s h o u l d r a t h e r s e e k t o l i n k them, achieving a synthesis mindful of the r i g h t s and o b l i g a t i o n s o f e a c h o f t h e m . " 2 8  Mr. provincial provincial Report  Pepin  also  authority stance,  outlined in  support  certain  reflected  fields.  in a  o n U n i t y , b r o u g h t Mr. P e p i n  Trudeau.  Mr.  Pepin  agrees  that  for  priority This  subsequent into  provide  insight  into  incident.  - 32 -  with  the  Mr.  point  probably l e d  ( 1 9 8 0 ) t o h i s a p p o i n t m e n t as T r a n s p o r t M i n i s t e r . will  Force  his, "...differing  o f v i e w o n t h e C o n s t i t u t i o n w i t h Mr. T r u d e a u "  Four  strong  Task  conflict  of  2 9  significance  Chapter of  this  During the to  a period  o f growth  possible exception t h e massive  federal  o f Quebec)  by t h e l a t e  1960s.this  all  shared  programs  establishment to  compete  federal  consultation officials  First,  more e x p e n s i v e  directly  with  each  inter-provincial  of the eleven  the  federalism,  i n f l a t i o n made  and a f f e c t e d t h e  other  government."  began  and w i t h t h e  conference.  appointed  Between 158  with  executive  this  Fletcher  ministerial  and W a l l a c e  federalism  impediment t o e f f e c t i v e  can  be  conflict  - 33 -  the  to practice  1957  s c a l e o f meetings  applies the relations of the  and p r o v i n c i a l  forum and  levels  executive  or  federal-  1977  meetings  a d d i t i o n a l 335 m e e t i n g s o f f e d e r a l - p r o v i n c i a l  Given  3 0  a n d among  officials  the intergovernmental  were  between  Dupre  The p r i m e mode u s e d  provincial  federal-provincial  embodying  of our federal  was  there  governments.  and  federalism  estimated  and  meetings  "...as  elected  energizing executives  agree  areas.  and s e c o n d , p r o v i n c e s  l e d to increased  executive  between  of  objected  government.  Increased  term  few p r o v i n c e s  changed.  o f new p r o g r a m s  more  (and w i t h  intervention i n provincial  But  cost  and p r o s p e r i t y  i ti s a n d an  officials.31  i t i s not d i f f i c u l t to that  the processes  identified management  as  a  of  major  i n t h e system  and  as  a  generator  federalism Ministers has  of  involves negotiating  switched  from  conflicts  central more  to  turf.  Executive  3  agents  and  fundamental  function  protecting jurisdictional  themselves. -^  power  senior  issues.  and  The  prestige  According  3 3  Cabinet  to  focus and  on  Smiley:  "In the Canadian system of government the e x e c u t i v e has a v e r y w i d e d i s c r e t i o n - f r e e d o m from effective control of the elected legislature, of party organizations and, in most circumstances, of private interest groups." 3 4  This between  i s compounded by and  confusion kept  among  and  secret  secrecy unless  them a v a i l a b l e t o  the  a maze o f  governments to  divided  which  negotiations.  there  are  media or  jurisdictions  adds Cabinet  strategic  complexity, Papers  reasons  i n t e r e s t groups  as  to was  are make the  c a s e i n t h e Crow R a t e d e b a t e .  This federalism  essentially  political  i s s u m m a r i z e d by  nature  of  executive  Smiley:  " . . . t h e i n s t i t u t i o n s and p r o c e s s e s o f executive f e d e r a l i s m are disposed towards c o n f l i c t r a t h e r t h a n harmony. F e d e r a l - p r o v i n c i a l s u m m i t r y a l o n g w i t h the r e l a t e d phenomenon o f administrative r a t i o n a l i z a t i o n has weakened the capacity of t h e s y s t e m t o make p i e c e - m e a l and incremental a d j u s t m e n t s a c c o r d i n g t o t h e norms o f s c i e n t i f i c  - 34  -  and professional groupings. Even more crucially, the pursuit of jurisdictional autonomy increasingly takes place outside a s h a r e d a c c e p t a n c e o f c o n s t i t u t i o n a l and l e g a l norms a b o u t t h e r e s p e c t i v e p o w e r s o f t h e two orders of government". 3 5  The been  natural  extension  t h e development  Liberal  Government's  of  on  National  governments. interest policies.  There  groups  was  o r even  such  Energy  federalism as  Program  the  has  revised  o f 1983 and  b o t h o f w h i c h a r e agreements  collaborative  a  executive  programs  t h e c u r r e n t PC E n e r g y P o l i c y , reached  of  basis  little  between  or  no  f o r Parliament  Audrey Doerr a s s e r t s  role  or  among  for  public  to discuss  these  that:  . . . t h e r a t e and s c o p e o f c h a n g e i n f e d e r a l government a c t i v i t i e s have c o n t r i b u t e d t o t h e development of a h i g h l y complex system of s t r u c t u r e s and p r o c e s s e s b y w h i c h g o v e r n m e n t r e s p o n s i b i l i t i e s a r e d i s c h a r g e d and a c t i v i t i e s u n d e r t a k e n , and t h e e x p a n s i o n o f f e d e r a l and p r o v i n c i a l a c t i v i t i e s h a s t h r e a t e n e d t o make the constitutional division of powers obsolete. 3 6  A  good  example  of c o l l a b o r a t i v e  p o s i t i o n of Prime M i n i s t e r to  Trudeau  f e d e r a l i s m was t h e  i n 1981 when he  refused  a d d r e s s t h e Crow R a t e i s s u e u n l e s s t h e w e s t e r n P r e m i e r s  were  i n agreement.  This  decision  - 35 -  was  taken  despite  the  call  f o r c h a n g e b y some w e s t e r n  representing Minister's 1981. year  the  majority  to  support  f o r change groups  the  such  represented  t o how  to take  the rate  action  should  of  surprising  that  of that  power. from  one  Despite  the  major  Agriculture  the  Prime  Minister  a consensus and t h a t  to deal  existed  the  three  consensus.  government p r i o r i t i e s  t h e governments  relations, have with  i t  established  and t h e is  not  complex,  these matters.  The  s e c t i o n e x a m i n e s t h e r o l e and f u n c t i o n o f t h e C a b i n e t  s y s t e m and i t s b u r e a u c r a t i c  2.1.3  arms t h e " c e n t r a l  agencies".  The C a b i n e t System  This Canadian of  almost  Western  until  intergovernmental  central policy structures next  the  be c h a n g e d  the contradictory  magnitude  after  Rate  producers,  p r a i r i e governments were p a r t  Given  Crow  Prime  F a r m Commodity C o a l i t i o n , w h i c h  a l l prairie  not agree  came  The  o n F e b r u a r y 12,  regained  as  C o n f e r e n c e and t h e P r a i r i e  as  i n Parliament  position  to  organizations  producers.  t h e day, the L i b e r a l s  agricultural  would  of  p o s i t i o n was made  Interestingly this  agricultural  section Cabinet  discusses system  regional ministers  the t r a d i t i o n a l  role  of the  and shows b y e x a m p l e how t h e r o l e  has changed  - 36 -  over  time.  In addition  the in  section  analyzes  western  Canada  the decline of L i b e r a l  as a p a r t  of a larger  the e r o s i o n of the n a t i o n a l p a r t y  The timely  government's  priorities  collective This the  Canadian  Cabinet.  Prime M i n i s t e r  member  be a p p o i n t e d  province.  of s p e c i f i c  factors  i n designing  c a n make p o l i c y  16-19  size  will  i s t o reach satisfy  meaning  Ministers.  parliamentary  i n Canada.  member f r o m  to the Cabinet.  just  to  3 7  as i t a p p l i e s t o  the Canadian  tradition  the  maintaining the  Cabinet  institution  In addition  account  system  while  the  who c h o o s e s w h i c h  political  The  of  phenomenon i . e . ,  c h a i r e d by t h e Prime M i n i s t e r ,  not n e c e s s a r i l y  every  that  and n e e d s ,  Under  supreme d e c i s i o n - m a k i n g  Canadian  way  has s i g n i f i c a n t  the Cabinet,  party w i l l  a  responsibility  definition  system  in  support  system.  b a s i c p u r p o s e o f any C a b i n e t  decisions  Party  i s the  I t i s the  the governing  I t h a s become a  appoint  least  one  region  but  from  any P r i m e M i n i s t e r  must  take  from  every  parliamentary, a Cabinet  at  economic  system  and  i n which  personal ministers  and e x p e n d i t u r e d e c i s i o n s .  of  the Cabinet  has  members o f t h e 1935 M a c k e n z i e  present  40-member M u l r o n e y C a b i n e t .  process  has changed  as w e l l  3 8  and t h i s  - 37 -  increased King The will  from  Cabinet  the  to the  decision-making be d i s c u s s e d i n  the f o l l o w i n g  A  s e c t i o n on - C e n t r a l A g e n c i e s .  unique  characteristic the  supreme  are  virtually  Unlike  and  of  somewhat  the Canadian  no  House  checks  of  many  European  Houses  with  various  has  no  and  balances  where  power  forms  veto  power,  However,  the  taken  by  had  the  Prime  Minister,  through  does  not  to  have  against  h i s wishes  Cabinet  solidarity  voice  who his  Resignations policy  among  elected  government. has the  ruling  parties'  dramatically  worry  (British  dissension ministers  differences  h a n d f u l h a v e done  are  so.  own  the  publicly from  the  rare  and,  - 38  -  3 9  Prime  voting  addition,  ensures  that  Minister  federal to  the  discipline,  In  without  up  and  members  Commons.  traditions)  with  Party  final  discussed  i t s power  of  his  i n t h e House o f  disagrees  of  about  opposition  already  used  concept  Upper  a f f e c t on t h e  As  seldom  and,  Canadian  T h i s was  a significant  the  the  i n t h e Crow R a t e d e b a t e when s t r o n g  n o n - e l e c t e d Senate  minister  the  power.  Cabinet  have  such checks.  f r o m Quebec L i b e r a l s approach  the  as  there  this  i s shared  which  caucus can a f f e c t government p o l i c y . demonstrated  on  countries of  i s that,  i n Canada,  R e p r e s e n t a t i v e s and  unlike  Cabinet  Cabinet system  decision-making i n s t i t u t i o n  the United States  Senate,  under-appreciated  any  cannot  resigning. Cabinet  1984,  over  only  a  The  demands  onerous. the  approximately  individual  minister 20,000  large  must  Cabinet  line  manage  employees.  In  and  Seaway  the  Canadian  Parliament the  Authority,  Transport  through  the  transport minister  interest  groups  and  d i s c u s s problems  constituency. appreciate  department  with  addition  and  much  documents  prepared  attending  a  by  Cabinet  other  time  to  the  resolve  110  commit t h e  Crow R a t e public  i n the f i r s t  of  their  purse  1982  to  or  issue.  Pepin's  t o an e x p e n d i t u r e  To  address  onerous  demands  Pearson  Cabinet  introduced a  - 39  before  wonders even  had  the  submitted  proposal of  how  $3.7  to  would  billion  i t s implementation.  on  ministers'  number o f  -  can  contained a proposal  Mr.  four years following  want  review  departments  understood  which  special  one  has  one  to  s e c t o r or  workload,  turn,  St.  such,  who  page Memorandum t o C a b i n e t  P e p i n on J u l y 9, the  fully  As  Parliament  federal In  the  report  target  minister,  large  Corporation  a l l  affecting  a  meeting.  Ministers  of  heavy  such  Rail,  Transport.  favourite  policies  time  Cabinet  by Mr.  a  this  many  read  is  of  such  Ports  Commission  Minister  are e.g.  a  Canada  f e l l o w Members  Given  how  the  members  departments  d i v e r s e o r g a n i z a t i o n s as A i r C a n a d a , CN  Lawrence  to  on  T h e y h a v e t o manage  transport  and  placed  ad  hoc  time,  the  committees,  including to  the  develop  situation.  Priorities  and  government  priorities  in  Under t h e  4 0  Priorities since  powerful  Committee  many o f  the  Trudeau  evolved  key  Planning the  Cabinet,  into  an  Cabinet  represented  Committees. recognized this  The an  key  Clark  Inner  full  Cabinet,  Cabinet  decision-making  and  a b o l i s h e d the Inner Cabinet  full  Cabinet  Committee will  be  retained (PEMS)  had  37  authority  discussed the and  Ministry  of  (MSERD)  and  in  to  the  Program  chaired  this  established State within  1979,  take  Economic  to  Trudeau  Cabinet  of  i n i t s place both  final  that  ministry  and  Mr.  Management service  As  4 1  Trudeau  Regional  the  Planning  decisions.  public and  officially members  section,  the  Cabinet  12  Expenditure  at  for  The  Cabinet.  other  the P r i o r i t i e s  next  and  in  and  members and  of  appointed  body.  1980  of  range  and, this  i t s d e c i s i o n s w e r e a c c e p t e d by t h e f u l l  a  Minister  and  on  committee,  introduced  Prime  fiscal  Planning  and  also  the  the  committee  He  because  overall  Inner  m i n i s t e r s were  Committee,  also  System level  a  Development  established  Federal  E c o n o m i c D e v e l o p m e n t C o o r d i n a t o r s (FEDC) i n e a c h p r o v i n c e . It a  i s interesting provincial,  not  to note on  a  t h a t FEDC's w e r e regional  FEDC w o u l d p l a y s i g n i f i c a n t  basis.  established Both  MSERD  r o l e s i n t h e Crow R a t e  - 40  -  on and  debate.  Brokerage political  theory,  science  which  field  argues  parties  must e n c o m p a s s a l l t h e  country  i f both  rights thesis over  to  the  Cabinet  in  analyze years  sectorial  Senate  a majority  guaranteed.  and  Canada  the United  but  does  "...Cabinet performing States".  dimension been  the  both  has  C a n a d i a n s be the  other  to  this  have  played  out  this  role  that  in  same  various  are  of  truly  function  regional,  raised  absence  become t h e  policy  any  as  Cabinet  i n Canada, and  a  equity  at  an  the  the  elected  federal  body  Senate  need t o t r e a t " r e g i o n s  in  the  one  regional  has  always  subject.  h a v e meant t h a t  h a n d demands  they  reside  of  - 41  and,  that on the  4 4  Cabinet  -  The  national  national p o l i c y recognize  differently".  logic  i s the  which  complex  e q u a l l y wherever  h a n d , demands t h a t  the  of  accommodate on  treated  However  scope  that  controversial  had  the  facing  p r i n c i p l e s o f e q u a l i t y and policy  minority  Minister  national  a  and  the  4 3  main problem of  political  interests in  secured  concerns  has  Canadian  national  be  degree  suggest  Role of the Regional  The  the  the  beyond  Cabinets  to  that  essential  is  provincial  level the  how  dominated  i s to  It  4 2  has  government  and  the  concomitant ability  of  Canada's  strict the  party  federal  regional  discipline  government t o  diversity.  as r e g i o n a l power b r o k e r s years.  A l a n C a i r n s has  The  4 5  has  sharply  reduce  reflect within concept  changed over  of  the  the  itself  ministers  last  thirty  described this transformation:  . . . e a r l y C a b i n e t s were c o l l e c t i o n s of r e g i o n a l n o t a b l e s w i t h independent p o l i t i c a l bases of t h e i r own who p o w e r f u l l y a s s e r t e d t h e needs of t h e i r p r o v i n c e s a t t h e h i g h e s t political l e v e l i n the land. The d e v e l o p i n g a s c e n d a n c y a t t h e P r i m e M i n i s t e r ' s o f f i c e (PMO), w h i c h has c u l m i n a t e d i n i t s a l l e g e d presidentiali z a t i o n u n d e r T r u d e a u , was made l e s s v i s i b l e to h i s p r e d e c e s s o r s . R e g i o n a l spokesmen of t h e c a l i b r e and a u t h o r i t y o f Jimmy G a r d i n e r ...continued i n t o the middle decades of the 20th century. Now h o w e v e r r e g i o n a l s p o k e s m e n of such power and authenticity are only memories. Although the regional basis of Cabinet appointment c o n t i n u e s , the regional power b r o k e r s a r e g o n e . 4 6  Since Minister the  this  thesis  in policy  role  of  focuses  development  Jimmy  Gardiner  c o u n t e r p a r t s O t t o L a n g and  James Agriculture Premier Transport  of  G. from  to  1974  the  1957  Saskatchewan. between  to  was  the  that  Otto  - 42  of  1979.  -  of  his  a  Cabinet  to  compare latterday  Pepin.  federal  (a r e c o r d )  and  role  i t i s necessary  Jean-Luc  Gardiner 1935  on  Lang  and  Minister was  was  Jean-Luc  a  of  former  Minister Pepin  of was  M i n i s t e r o f T r a n s p o r t b e t w e e n 1980 a n d 1 9 8 3 . *  It these  i s interesting three  Each  ministers  minister  "Regional Norman  was  Minister  Ward  4 7  have  period injected  are  does n o t e x i s t .  one  relate  time  jointly  Through  "...regionally  access  Today  each  David a  to  be t h e  E. S m i t h a n d biography  t o the Gardiner career  powerful into  t h e concept  of  to the prairies.  writing  interests  of  considered  t h e 22 y e a r  provincial  institutions".  they  features  of the P r a i r i e s " .  described  when,  as  at  James G. G a r d i n e r . they  t o compare  Papers  of Gardiner federal  on  as a  ministers  central  government  of regional  ministers  They have been r e p l a c e d as S m i t h  a n d Ward  suggest by: ...strong provincial politicians challenging governments in Ottawa and first ministers' conferences competing w i t h C a b i n e t as t h e forum i n which r e g i o n a l i n t e r e s t s a r e e x p r e s s e d . 4 8  This the  i s supported  federal-provincial  decline by  assessment  as an i n s t r u m e n t  conference  by Matheson has  of regional  S i m e o n who b e l i e v e s t h e f a i l u r e  who  led to  states  Cabinet's  accommodation  4 9  and  of the National Party  *Both Mr. Lang and Mr. Pepin held other Cabinet positions at other times but it is their tenure as Transport Minister which is of importance here.  - 43 -  System  led  to  Conference. three  formation  Smith  5 0  unique  minister.  the  and  features  Ward to  of  5 1  the  First  determined  Gardiner's  Ministers'  that  style  there  of  were  regional  These d i s t i n c t i o n s were:  1. H i s b e l i e f t h a t when t h e p e o p l e h a v e v o t e d a majority government, minority interests s h o u l d n o t be a l l o w e d t o i n t e r f e r e . 2.  In Cabinet, the p r i z e went t o t h e m i n i s t e r who c o u l d c o n v i n c e C a b i n e t t o s u p p o r t him.  3.  His fervent i m p o r t a n t on  Certainly  there  s i n c e b o t h Lang of  members  Where  and  who  in  Gardiner obsession  Pepin  he  little that  position River  faith  No  i s s u e on  the  1930s,  dam  was  his  the  compare  urgently  needed.  and  of  -  comprised approach.  is  in  bureaucracy there  from a c e n t r a l  the  the  south  since  the  an  was  a  this  Saskatchewan drought  belief  supported  and  Canadian  demonstrates  Saskatchewan's  Gardiner  model  above c h a r a c t e r i s t i c s .  prairies,  - 44  Pepin  colleagues  issue  to  Gardiner's  Gardiner  probably  the  could  the  senior  country  issue  than  the  to  issues  i n Cabinets  Lang  in  the  better  Dam.  from  among  No  5 2  with  applied  p r e - d i s p o s i t i o n t o see perspective.  unique  functioned  agree  departs  which  had  i s nothing  would  Gardiner  manner  d e s i r e t o make r e g i o n a l a national basis.  this  that  of a  belief  and  spent  most  of  convince  the  which  believed  he  his  federal  career  in  government  would  be  Ottawa  to  "the  attempting  construct  greatest  a  be  an  i s i n t e r e s t i n g to  issue  issue  that  with  should  backing  prairie  Premiers.  federal  Liberals  S a s k a t c h e w a n and  The on  studies  a  was  former  a  basis.  but  was  not  as  the  signalled probably  need  dam  in politics,  of  the  the  to  the  to  phenomenon. Party  end the It  end also  of  as  a  and  to  regional all  the  the  was  that  show t h a t  three  Manitoba  Premiers  that  for  an  such  Alan  federal and  the  of  - 45  -  benefit-cost was  has  real  the  Gardiner  regional  the  their  matter".  build  Jimmy  As  stated  constrains  to  of  a  Saskatchewan  perceptions  with  i n w e s t e r n Canada.  in  debated  undertaking.  policy  powerful  coincided  no  Blakeney  Liberals career  i t was  there  believed  beliefs  failure  were  5 3  lent i t s e l f  as  a p p e a r s t o be  Premier that  case  in  5 4  There  perceived  dam  members  the  opposed  Gardiner  believe  and  The  Liberal  were  Saskatchewan  "westerners region  This  Manitoba.  dam  the  a l l federal  undertaken which would  for  there  that  have been s u p p o r t e d  main problem w i t h  a political  need  by  note  project  achievement  Saskatchewan toward the development i n C a n a d a " .  It  to  decline  5 5  dam and  minister of  the  D e c l i n e of t h e L i b e r a l P a r t y  An 1953  of the  of federal  a n d 1980 show  federal the  examination  Liberals  a steady  i n western  e x c e p t i o n and t h i s "Trudeaumania". Liberals  began  "Progressive  immediately  The d e c l i n e  what p r i c e federal  h i s intention  In addition  in  funds.  Premier  This  t o set prices producers  government  a l l o c a t i o n o f boxcars  In t h e f o l l o w i n g  the  led  by  Diefenbaker  he e s t a b l i s h e d  t h e Prairie  t h e Canadian  a n d make p a y m e n t s t o  t h e Board receive  actually  for thegrain.  knew The  t o payf o r any s h o r t f a l l  also  t o head  Mr.  of  t h e South  before  i s committed  support f o r  government  A c t encouraged  eventually  Bracken  the  to build  f o r wheat  Mr. Diefenbaker  John  for  theelection  minority  announced  i t would  between  T h e 1968 e l e c t i o n i s  i nelectoral  Diefenbaker.  grain  i nsupport  i n 1957 f o l l o w i n g  Dam.  results  c a n b e a t t r i b u t e d t o t h e phenomenon  Grain Advance Payment Act.  prairie  decline  John  Saskatchewan  Board  election  Canada.  Conservative"  Saskatchewan's  Wheat  i n W e s t e r n Canada  appointed  a Royal  former  Commission  Manitoba on  the  for grain.  e l e c t i o n o f 1958,* t h e PC's went  from  *(1) Jimmy Gardiner lost his Melville seat in the 1958 general election ending 41 years of service as either an MP or ML A. (2) The dam originally begun by Mr. Diefenbaker was completed in 1968 under Liberal Prime Minister Lester Pearson. The dam was named after Jimmy Gardiner and the dam-made lake was named after John Diefenbaker. - 46 -  3  s e a t s and  out of  17  23  per  s e a t s and  subsequent  51  late  1960s  the  any  at  of  supporters.  cent PC  of  a  cost  Primary  of  grow and  David  the  actually  Smith  Liberals needed  sequent  provincially)  not,  of  have p r e f e r r e d t o  effort  like  sugar  the  dam  such  and  the years  as  beets  wheat  which  constant  which  played a central  was  real  Barry W i l s o n  the  to  was  by  and  require  effort  to  analysis  i n the  was  a  highly  and  structural  of  public  1970s.  educated changes  g r a i n h a n d l i n g and  the  sub-  (federally  and  since this  Otto  was  were  - 47  -  question  to  development  in  Otto  learn the Lang  believed that basic  required  t r a n s p o r t system  a  was  U n l i k e Jimmy G a r d i n e r , t e c h n o c r a t who  "perceived  debate.  L a n g who  policy  whether  in  q u e s t i o n of  r o l e i n t h e Crow  concluded  dam,  factor  Party  The  have  5 7  the  major  Liberal  Transport Minister lesson  build  a  i n Saskatchewan.  requires further  prairies  never  producers  and  5 6  need"  the  h e n c e has  in  grain  failure  or  decline  It  completed  harvest.  Both -that  dam,  in  over  crops from  nine  envisaged  of  irrigation  In the  16  role  barley  expensive  The  $200 m i l l i o n  r e q u i r e minimal  place  the vote.  P a r t y r e c e i v e d more v o t e s  grow c r o p s w h i c h in  i n Saskatchewan to  other Party.  come c l o s e t o p l a y i n g t h e its  the vote  per  elections,  Saskatchewan than the  cent  to  on t h e  modernize prairies.  the  Table reasons  1:  The  Liberals  (left-handed  which they a l l e g e  T a b l e 1:  in Saskatchewan  column) p r o v i d e d by Smith  - P a r t y o r g a n i z a t i o n and p o l i c y favoured C e n t r a l Canada - Ministerialists - Resource p o l i c y e n f o r c e d dependence - S o u t h S a s k a t c h e w a n Dam ($200 m i l l i o n ) b u i l t by D i e f e n b a k e r r a t h e r than Pearson  the  items  author  policies  to  which  and W i l s o n  L i b e r a l Record  Agricultural  the Liberal  probably  & Events '  Policy  Grain s t a b i l i z a t i o n plan R e t e n t i o n o f most b r a n c h lines Modernization of grain system ($1.7 b i l l i o n ) Change i n Crow R a t e  on t h e r i g h t - h a n d column show  Party.  Popularity of Diefenbaker P a r t i c i p a t o r y democracy Western Economic Opportu n i t i e s C o n f e r e n c e (WEOC) R e p o r t on B i l i n g u a l i s m / Biculturalism O f f i c i a l Languages A c t M e t r i c Commission  Policy  - R e s i s t a n c e t o advance g r a i n payments - Operation LIFT - B r a n c h l i n e abandonment - Change i n Crow R a t e  the  i n Saskatchewan 1968-1980  Reasons f o r D e c l i n e a c c o r d i n g to Smith/Wilson  The  lists  l e d to the decline of the Liberal  The L i b e r a l s  Agricultural  1968-1980  affected  prairies.  - 48 -  a r e compiled by  achievements their  standing  and t h e on t h e  The  two  Liberals,  which  of and  they  paternal  the  by  Quebec allege  and  sustaining  popularity  policy  the  held  Conference  i n 1973  In blamed  terms for  out  soared  of  and  advantage  of  of  was  of  west in  a  were  the  centred  in  "ministerialism"  by  the  west  priorities.  taking  ignoring  a  its  encountered  they t r i e d  "participatory  Western  to  democracy"  In a d d i t i o n  Economic  agricultural  policies  Operation  encouraged  production i n  the  the  the  Opportunities  to address a l l e g e d western g r i e v a n c e s .  which  many  the  Party  establishing  Tomorrow)  land  the  of  which  f o r Diefenbaker which  mention  of  i n Cabinet M i n i s t e r s  Liberals  in establishing  Liberals  For  the  downfall Wilson,  concept  towards  However  with  the  the  and  Party  resulted  concerns.  for  Smith  Liberal  attitude  counter  reasons  suggested  structure Ontario  general  prairie  LIFT  grain  1972.  In  producers  higher prices  and  the  Liberals  (Lower  Inventory  producers 1973,  could  therefore  to  grain  not  were  take prices  take  the  full  Liberals  were blamed.  Smith  also  argues  that  e s t a b l i s h e d programs such believes Quebec  favoured over  the  the  as  the  Federal  Cabinet  i t s resource p o l i c y ,  consumer  resource  - 49  provinces of  provinces  -  of  either  which  Ontario Alberta  he and and  Saskatchewan, agriculture an  or  to  respond  to establish  more h o s t i l e t h a n  policy  that which  faced  with and  prairie  a situation  of  faced much  M r . L a n g was  Conservatives during  who w e r e  t h e 1970s a n d  M o r e o v e r , M r . L a n g was f a c e d  of having  t o modernize  a grain  handling  t r a n s p o r t s y s t e m w h i c h h a d become a r c h a i c *  The  result  implement stiff  was  death k n e l l  line  network,  that  abandoned  abandoned  by  recognition.  grain  date  producers  Perception  which  greatly  influenced  policy  i n t h e 1970s.  Mr.  t o t h e system  abandoned  Lang  one-half (1984)  was met b y  grain  ruled a  85 p e r c e n t o f i n the late  i s still  i n place  of a l l branchline had  has never  and m y t h o l o g y  to  was c o n s i d e r e d  was e s t a b l i s h e d  was a f a c t o r ,  nearly  to  by  Approximately  which  haulage  effort  and a d v e r s a r i a l p o l i t i c s  branchline  The f a c t  mileage  changes  on t h e p r a i r i e s .  1930s when h o r s e today.  every  Rhetoric  d a y as e v e r y  rail  that  structural  resistance.  the  the  Premiers.  Mr. Lang  Gardiner.  by t h e f e d e r a l P r o g r e s s i v e  three  t h e case  on t h e p r a i r i e s  t h e predominant p a r t y on t h e p r a i r i e s the  in  t o t h e needs o f t h e p r a i r i e s .  environment  opposed  failed  already  received were  handling  been public  the factors  and  transport  *The problems associated with the grain handling and transport system are discussed in detail in Chapter Four.  - 50 -  To dam,  what  that  purposes, in  was has  was  Mr.  construction really  enabled  the  be  more  Lang  was  responsible  related  projects  ended  in  1980  with  only  Lang  lost  his  Canada.  Mr.  election.. in  The  two  was  argues  caused  by  particularly prairies,  million  irrigation elections In  i n winning  the  the  over  $1.7  prairies  two  seats  Saskatchewan  his  a l l of  seat  i n 1980  In  the  billion  yet  in  turn, support  Jimmy G a r d i n e r .  insensitivity  Laurier,  expectations. the than  Canada".  party  had  agricultural  its  under  Liberals  effect  the  Liberals'  national  and  that  the  "synonomous w i t h  Act  for  answered.  for  seats  $200  in  of  party western  the  were b o t h  1979  located  Winnipeg.  Smith  the  on  Liberal  a  dominate ten  fully  t h a n was  transport up  to  successful  colleagues  of  required  PC's  cannot  far  his Cabinet  1970s  the  never  Saskatchewan  O t t o Lang of  degree  in  did  Liberal  towards to  recognize  become  for  argument  power,  between  1963  synonomous of  policy,  Commission  Otto  policies,  had  the  opposite  terms  Metric  failure  of  An  become In  decline  on  Lang's  the  and  with  the  perceived  had  the  -  the world  i s that 1984,  as the  unrealized Languages a  greater  transport  the d e c l i n e of the L i b e r a l  - 51  west  that  Official  probably  party  and party.  It  i s appropriate  context March  of the circumstances  3,  1980 when  he was  He f a c e d a s i t u a t i o n to  modernize  and  many  However  to point  out that  that  faced  appointed  this  Jean-Luc  Transport  where t h e s t r u c t u r a l  Pepin,  groups  lobbied  e l e c t e d i n an O t t a w a  would  be c o n f r o n t e d  that  led to  with  the  t h e same  demise  of  on  Minister. required  not i n place  f o r such  riding,  changes.  knew t h a t  "misconception  Otto  the  Pepin  changes  t h e t r a n s p o r t system were s t i l l  agricultural  was  Lang.  theory"  Chapter  documents t h e P e p i n s t r a t e g y t o d e a l w i t h t h i s  he  Five  conundrum.  Summary  This Canadian dimension  section discusses  the t r a d i t i o n a l  Cabinet  It  in  Provincial viewpoint represent  system.  Cabinet  Premiers as opposed  has  of the  shows  how  the  diminished  in  recent  provide to federal  the  basic  Cabinet  regional times.  "provincial"  Ministers  which  a "region" i n Cabinet"  Special  emphasis  is  given  to  illustrate  the t r a d i t i o n a l  regional  comparison  i s made  typical  Minister  role  on  the  to  a  prairies  (Otto  - 52 -  James  Gardiner  minister's contemporary  Lang)  to  role.  to A  Cabinet  document  the  changed environment  The  role  discussed  played  (this  e v e n t u a l l y was even  though  f a c e d by c u r r e n t C a b i n e t  is  Mr.  done  t o be  he  by  seen  Pepin  in as  represented  is  Chapter  a "prairie a  high  Ministers.  not  specifically  Five)  because  regional  he  minister"  income u r b a n  riding  in  of  the  Ottawa.  2.1.4  Role of the C e n t r a l Agencies  The Cabinet This  preceding and  section  structure,  The  role  (TB)  analyzed, involved  Cabinet  deals  with  discusses  Minister  the  role  in policy  another  complex,  development.  central  policy  the C e n t r a l Agencies.  Minister's Board  the  section  of  the  C e n t r a l Agencies  Office  (PMO),  and  Department  particularly in  the  Crow  Privy of  The provincial)  function is  to  of  (PCO),  Finance  (FIN)  debate.  p a r t of the p r o v i n c i a l governmental  Central  provide  - 53  agencies  the  Prime  Treasury will  were  Similar  be  directly  agencies  are  structure.  Agencies  coordination  -  as  Council  since these Rate  such  (federal of  and  government  programs  and  role  governments,  of  government  priorities.  work  the  capacity  its  demands.  only  to  evolve to  (1.2  Thus  5 9  through  to  complex,  functional  the  Canadians)  size  of  affects  5 8  make s o c i e t y  responsive  agencies  expected  not  policy  can  government d e p a r t m e n t s but  also  central  maze o f  the  believes  million  processes  the  the  Cairns  government  establish  address  Alan  force  of  Notwithstanding  whereby  economic  are public  issues  currently  to  facing  Canada.  Each countries federal  government  in  has  central  unique  level,  responsible  there  for  involved  believe  involved  are  the  Council  Office  (FIN.).  Since  the  Crow  is  no  and  governments  agencies. one  although  they  prime  are  the  Prime M i n i s t e r ' s  each  Treasury  of  the  debate  a  in  Canada,  that  is  other at  the  totally  all  four  agencies  agency.  The  agencies  Office Board  organizations short  In  agency  coordination  (PCO),  Rate  Canada  (PMO), t h e (TB)  and  Privy Finance  were i n v o l v e d  description  of  each  in is  provided.  Prime M i n i s t e r ' s  PMO Minister.  is  Office  staffed It  is  the  by  personal most  appointments of  partisan  - 54  -  and  ad  hoc  the body.  Prime It  provides basis  political  with  advice  survival  of  ( 1 9 8 5 ) t h i s o f f i c e has  and  i s concerned  the  on  government.  In  a  day-to-day-  recent  g r o w n i n s i z e t o o v e r 100  years  officials.  Privy Council Office  The  PCO  provides the  Secretary  Cabinet  to  the  coordinates  T h e s e two  and  The  the  saw  "...that  their  White  the  alternative less  roles  dependent  addition  the  demonstrate,  House  "regional  Premiers  who  of  policy the  The  in  of  most  and  i t  services  PCO  is  senior  Cabinet  Washington  less  years  the  of a l l  Committee  and  advice  public the  and  Thorburn  and  to  direct  themselves  - 55  -  as  No. PMO  10 and  concludes, himself  t h u s make h i m s e l f servants."  on  6 0  debate  Parliament  PMO/PCO h a v e become t h e in  Canada  give  Crow R a t e  dependent  to  both the  been a b l e  senior  ministers" portray  and  somewhat u n i q u e  Over the  become  even h i s m i n i s t e r s . of  are  P r i m e M i n i s t e r , as has  the  strengthened  upon  head  controls  P r i m e M i n i s t e r has sources  servants  a l l b r i e f i n g s to the Prime M i n i s t e r .  Downing S t r e e t i n London. PCO  The  is  PCO  organizations  to  public  to the Cabinet  Committees.  Cabinet  servants.  a g e n d a and  compared  career  prime t e c h n i c a l advice  various  public  i s s t a f f e d by  conflict providing  In will and  equivalent with  the  regional  input  in  policy  PMO/PCO w h i c h  development.  conduct  For  example  most o f t h e p o l l i n g  each r e g i o n i s r e a c t i n g t o government  The  PMO  and  agencies  from  maintain  liaison  economic  PCO  the  also  In  development  and  energy.  working  relationships  with  natural  resources.  Large  The of  PMO  the  various  provincial access  with  provincial  departments.  to the o f f i c i a l s  PCO  has such  companies  maintains links  such  as  PCO.  offices  other  PMO  and  Canadian  i n the and  addition,  as  established  access to the  officials  will  as e n e r g y  such  Premiers  In  how  central  PCO  departments  sectors  and Nova h a v e d i r e c t  with,  addition,  provincial  key  the  to determine  liaison  key  Pacific Limited  with  is  initiatives.  maintain  provinces.  i t  has  key  direct  i n the l o c a l c o n s t i t u e n c i e s of the  p a r t y i n power.  As with or  a  a  result,  b o t h PMO  sensitivity  as  as t o t h e e x i s t e n c e  elaborated advised there  was  on  the not  later, Prime a  and  t o how  PCO  provide the  policies  are  being  of s u p p o r t f o r change. both  the  Minister  consensus  PMO  that  and  i n western  w i t h t h e Crow R a t e .  - 56  -  PCO  between  government  As  accepted will  be  consistently 1980  Canada  to  and  1982  "tamper"  The Ottawa  other  two g r o u p s  are Finance  and T r e a s u r y  Finance  i s responsible  taxation  and T r e a s u r y  the  expenditure,  programs. Stress be  larger  put  than  more e m p h a s i s  servants with  Britain  among  who  Similar  work  t h e PCO f u n c t i o n s  functions was  may  although  Intergovernmental  develop adopted  The  many  of  p l a n n i n g and  Cabinet  than States.  public be  and  As such  the, "...senior  agencies  i n Canada) a r e i n government.  i n the ten  many  o u t by t h e department  Premier social  6 2  provincial  notably Alberta,  I n Saskatchewan  by  t h e major  collegiality  counterparts i n  o u t by t h e E x e c u t i v e  i n 1944  public  their  i n some c a s e s , are carried  S t a t e s and  The s e n i o r  servants  found  Under  i n Canada t e n d t o  access  do  approved  Governments  and t h e U n i t e d  greater  Relations.  are carried  established  agencies  i n (central  powerful  agencies  governments of  have  ministers  t h e most  of  i n h i s book  i n Britain  and t h e U n i t e d  officials  The D e p a r t m e n t o f  on p r i o r i t y - s e t t i n g .  i n Canada  Cabinet  departments,  the central  those  Board.  agencies i n  i s responsible f o r monitoring  Campbell  that  as c e n t r a l  f o r macro-economic  Board  by  Colin  states  61  included  of  t h e PCO/PMO  Council  Tommy  Douglas  programs  which to  eventually  by t h e r e s t o f t h e c o u n t r y such as M e d i c a r e .  central  agencies  play  - 57 -  a  strategic  role  i nthe  process Approval in  of  Cabinet  provides  approval.  an o v e r v i e w  Figure  1:  Process  of  o f how d e c i s i o n s a r e r e a c h e d  Ottawa.  The  process  i s based  Cabinet  o n two p r i m a r y  principles:  1) A l l m i n i s t e r s h a v e t h e r i g h t t o b r i n g t o their colleagues proposals f o r government a c t i o n i n areas o f p o l i c y r e s p o n s i b i l i t y , and 2) A l l m i n i s t e r s s h o u l d h a v e t h e o p p o r t u n i t y t o e x p r e s s an i n f o r m e d v i e w w i t h i n t h e C a b i n e t p r o c e s s on a p r o p o s a l f o r which they w i l l share c o l l e c t i v e r e s p o n s i b i l i t y . 6 3  - 58 -  F i g u r e 1:  Memorandum l o Cabinet  Process of Cabinet  Cabinet Committee  Committee Report  Approval  Cabinet or Prlorltlat B Planning  Record of Daclalon  I  Briefing lor Chairman .  Draft  Pt Ivy Council Ollica  Dapartmant  1 Finance  E conomlc Allotment  TB Secretariat  Costing Allotment  i  r  For p e r s o n - y e a r s , c o n t r a c t a u t h o r i t y o t c .  TB Submission Mlnlatar  Dapartmant  Source:  Treasury Board  |  Decision l e t t e r  Secretariat Secretariat  Note  Ian D. Clark, "Recent Changes in Cabinet Decision-Making", Canadian Public Administration. Vol. 28, 1985, p. 199.  - 59 -  As and  i n Figure 1,  indicated  Treasury  Board  liaise  on  a program o r p o l i c y  of  t h e c e n t r a l agencies  access a  with  agendas  PCO  and c a n , t h r o u g h  proposals  i s a power  disputes  PCO  i t may  department.  information sets  which  Cabinet. initiatives electoral another  discussed  the timing  Cabinet  there such  and  of  committees.  to resolve minister  were  any or  additional  as MSERD a n d MSSD,  had t o pass  1980  committee  before  as  one  of  reaching several  u n d e r t a k e n by t h e L i b e r a l s t o overcome l a c k o f  coordinating  elected  2.1.5  in  representation  Committee  control  the supporting  a l l proposals  Moreover,  Cabinet  with  years  have  r e q u i r e d t o make  to exploit  c o o r d i n a t i n g committees o p e r a t i n g , through  the  by v a r i o u s  previous  department  committees  attempts  have  In  Cabinet  process,  t o be c o n s i d e r e d  Finance  I t i s the essential role  t o ensure  usually  of  the supporting  proposal.  to a l l the appropriate  decision.  This  t h e departments  chaired  members  i n t h e west,  committee by  from  Lloyd western  called  they  t h e Western  Axworthy, Canada.  established yet  one {This  of  Affairs i t s two  committee i s  i n Chapter F i v e .  R o l e o f I n t e r e s t Groups  The special  purpose of t h i s interest  groups  section i s to discuss i n public  - 60 -  policy  the role of development.  Special  interest  Crow R a t e  groups  reform process.  demonstrate federalism  the and  demonstration  ways  interest  of t h i s  exploited  by  Mr.  to  Pepin's  which  groups  the  i n t e r e s t groups  groups  was  i s to of  Pepin  and h i s  and w e r e  i n turn  Chapter  to  but i t i s also  thesis  As  themselves. as  i n the  change.  how  a  Five  successful  necessary  some i n s i g h t f r o m a t h e o r e t i c a l p e r s p e c t i v e of  part  combination  constrain  the question  strategy  integral  i n t e r a c t i o n , Jean-Luc  these answer  an  A purpose of t h i s in  opponents both e x p l o i t e d  attempts  played  to gain  as t o t h e r o l e  i n t e r e s t g r o u p s i n a f e d e r a l s t a t e s u c h as C a n a d a .  According compete  with  privilege makers."  to  Doern  political  and  Phidd  parties  of i n t e r p r e t i n g the public 6 4  Pross  defines  members  order  t o p r o m o t e common i n t e r e s t .  Back executive  act together  i n 1974, Donald federalism  contributes  as  recent  a  practised  f o r the  t o key d e c i s i o n as  organizations  public  long-term  i n Canada  policy i n  critic  argued  non-participatory  of that  and n o n -  6 6  therefore,  - 61 -  groups  6 5  Smiley,  to secret,  times,  will  to influence  accountable process of government."  Until  t h e media  i n t e r e s t groups  whose  "...it  and  "...interest  the Canadian  public  policy  process  tended  view  regarding  dominant  federal-provincial Richard  to  be  relatively,  access  of  decision-making  closed.  interest  processes  S i m e o n , who i n t h e e a r l y 1970s a r g u e d  The  groups  was  that  to of  that:  The machinery (of f e d e r a l - p r o v i n c i a l i n t e r a c t i o n ) .. l i m i t s t h e p a r t i c i p a t i o n o f i n t e r e s t groups i n t h e b a r g a i n i n g process. Affected g r o u p s a r e n o t i n v i t e d t o p a r t i c i p a t e o r make t h e i r v i e w s known. The r e l a t i v e s e c r e c y o f debate means i n t e r e s t group leaders may o f t e n be u n a w a r e o f d e v e l o p m e n t s i n f e d e r a l p r o v i n c i a l n e g o t i a t i o n s which might i n v o l v e them. 6 7  In often  other  words,  forgotten  he  because  found  governments  governments  as t h e c r u c i a l  that  when  "even  particular sacrificed  when  good  example  when  the Prime  Crow R a t e prairie  the broader  Minister  act  tend  Simeon f u r t h e r  argued  representatives  indicated  are  likely  theory  that  consensus  was  of  to  are i n v o l v e d . "  Limited Access  are other  as  concerns  groups  t o regard  interests  r e f o r m had t o i n c l u d e  6 8  A  i n 1981  any consensus among  be  the  on  three  Premiers.  Richard trucking  those  o f Simeon's  interest  actors.  governments  interests,  that  Schultz,  on  the basis  industry i n Ontario  of h i s study  i n t h e e a r l y 1970s,  - 62 -  on t h e  discovered  that in  there  are occasions  the entire  process  against  the other.  often  involved  governments crack  After concluded, provincial  a  and c a n  in  an  further  decisions."  7 0  government o f f  that interest  exchange  literature  groups are  relationship  support  to  search  Fletcher  the i n s t i t u t i o n a l  .interaction to  one  Grodzin's  with  multiple  6 9  "that  available  "play"  His findings  lends  theory.  when i n t e r e s t g r o u p s a r e i n v o l v e d  Banting  framework  influences  particular  and  the  interests  to  Wallace  of f e d e r a l opportunities  share  policy  a r g u e d i n 1982 t h a t :  "Because t h e i n s t i t u t i o n a l framework expands or contracts the circle of critical decision-makers, structures the nature of political competition, and s p e c i f i e s t h e form of r e p r e s e n t a t i o n of t h e wider p u b l i c , it necessarily conditions the access of different political interests to policym a k e r s , s m o o t h i n g t h e p a t h w a y o f some and raising obstacles f o r o t h e r s . " 7 l  Fletcher assumption cautious  and W a l l a c e  but they  on making  were  believed quick  conclusions  that  was  t o add t h a t i n this  area.  a  plausible  one s h o u l d  be  According  to  Smiley:  " I n t h e s t a t e o f o u r p r e s e n t k n o w l e d g e we should be e x t r e m e l y c a u t i o u s about making g e n e r a l statements about t h e r e l a t i o n between  - 63 -  i n t e r e s t g r o u p a c t i v i t y and t h e p r o c e s s e s o f executive federalism. Some patterns of federal-provincial interaction, such as those related to the equalization of provincial revenues, appear to involve governments almost exclusively, In other circumstances for example...(regulatory issues), interest groups a r e much more influential. And i n y e t o t h e r s i t u a t i o n s , such as (energy pricing), the relative influence of interest groups i n intergovernmental negotiations may c h a n g e q u i c k l y and dramatically." 7 2  Fletcher can  allow  and W a l l a c e  interest  identified  groups  to  three  access  factors  policy  which  decisions.  These f a c t o r s a r e : 1.  P o l i t i c i a n s must be c o n c e r n e d w i t h i n t e r e s t i n v o l v e m e n t when m a j o r p o l i c y issues are discussed.  group being  2. I n t e r e s t g r o u p s w i l l be i n v i t e d i n t o t h e p r o c e s s when one o r more o f t h e g o v e r n m e n t s involved require t h e i r support. 3. I n highly technical areas, representatives will serve as federal/provincial delegation.  interest a member  groups of a  7 3  As  is  themselves  demonstrated  often  seek  in  support of t h e i r  to  g e t an i s s u e  in  this  to mobilize  positions.  thesis,  interest  External  group  activity  pressure can help  on t h e f e d e r a l - p r o v i n c i a l  - 64 -  governments  agenda  and t h e  role  of  interest  groups  to  trigger  Crow R a t e  reform  was  significant.  2.1.6  R o l e of the Media  In  keeping with  to  identify  to  be  this  able  the  a  institutions  discusses  major  necessary  key  theme o f  to determine t h e i r  section  played  the  part  the  to e s t a b l i s h  what  in policy  of  Crow role  chapter,  which i s  w h i c h must be u n d e r s t o o d  role  role  i n the  this  development,  the media. Rate  The  reform  t h e media  media  and  i t is  plays i n policy  development.  According  t o J . D.  Forbes, the  role  " . . . t o d e f i n e t h e p r o b l e m s and a g e n d a s to  communicate  information  amplify the i s s u e s . " difficult meeting how the  these  interested media.  "interested the  House  It  on  run  of time  the  media  frame."  . ..  mass  media to  produces  7 5  - 65 -  ignored an  the  i t is is in  through  media  are  partisanship  of  within i t .  but the  often  to  establish  knowledge  the  and  i s true,  the p e r s o n a l i t i e s  I s s u e s and i d e a s a r e n o t t o t a l l y span  on  is  consideration,  matters  believe  feed  t h e media  difficult  i n gaining  Phidd  'news',  Commons and  the  i s also are  and  in  these  effective  Canadians  first of  how  tasks.  Doern  under  Whether o r not t h i s  7 4  t o measure  about  of  attention  ludicrous  short  Not helps  only  to  does  the  s h a p e i t by  media  the  report  amount  of  the  news b u t  time  i t also  i t devotes  to  an  because  we  issue.  An  understanding  depend  almost  information  about the  public policy.  do  not  always has  world.  a  on  political  As  great  mass  world  read  Eugene  on  Hallman,  the  for  hear  way  but  we  who  our  development  i n Chapter  or  the  media  and  i s demonstrated  influence to  i s essential  the  b e l i e v e what we  According  many y e a r s  the media  completely  of  media  of  Five, the  look  has  we  mass  at  the  worked  for  i n the Canadian media:  " P u b l i s h e r s a r e d e a l i n g i n p o w e r , t h e power t o d i s c l o s e i n f o r m a t i o n or deny d i s c l o s u r e , to p r o v i d e a f r e e range of o p i n i o n , or to p r o v i d e some o f i t ; t o c o o l p u b l i c o p i n i o n o r t o h e a t i t up...The f r o n t page and the editorial page a n n o u n c e what and who are i m p o r t a n t and why t h e y a r e . " 7 6  This 1914  r a i s e s the  t h e r e has  in  Canada.  of  a l l  question  Concentration  ownership  been s i g n i f i c a n t c o n c e n t r a t i o n of  Today o n l y the  about p r e s s  f o u r companies produce  newspapers also  freedom.  As  will  ownership  (many o f  in  .raises be the  documented major  question in  Chapter  agricultural  - 66  newspapers  80  English-speaking  the  -  Since  of Five  per  cent  Canada. editorial -  press  organizations in  the  west  produced  their  played a s i g n i f i c a n t  After  own  newspaper)  and  editorials  r o l e i n t h e Crow R a t e d e b a t e .  a d e t a i l e d study of  the media,  Fletcher  (1981)  observed:  "Researchers are agreed... that the news media, through their selection and p r e s e n t a t i o n o f news, c a n r e i n f o r c e v o t i n g d e c i s i o n s , help t o f o r m images o f leaders and p a r t i e s , and i n f l u e n c e t h e s e l e c t i o n o f i s s u e s and t h e t o n e o f t h e c a m p a i g n , a l l i n ways t h a t may w o r k t o t h e a d v a n t a g e o f one party or the o t h e r . " 7 7  Another fact  that  newspaper  cities  or  radio in  newspaper advertising.  printed, cities  is  the  analysis press  to  favour  usually  ignored.  produce  the  have of  a  the  than  one  Many  small  news  releases,  government's  was  of a  the  weekly  governments staff  stories i f  for which to  they  be are  The p o l i c y i n l a r g e r  a government  - 67 -  more  only  on  n o t be e d i t e d .  i s to conclude that  have  station.  dependent  newspapers  usually w i l l  west  T.V.  prairies  Government  slanted  i n w e s t e r n Canada  the  and  These  allow  presented.  in  the  which  not  situation  few  communities  does  unique  press  position  release and  is  i t is  Chapter  Five  examines  Crow R a t e d e b a t e . "western" Premiers  t h e impact o f t h e media on t h e  S p e c i a l emphasis  media  were  biased  a n d t o t h e manner  newspapers question  covered  addressed  availability competition, Commission. executive  as  Five  information  advocated  federalism,  will  should  be r e m o v e d .  Rate  but  even  understanding  those  the basic  had  t o be c h a n g e d .  one  instance  the  development.  Also  degree t h e efficient Royal  a r e s t r i c t i o n of  equal  to national  A s i s shown i n C h a p t e r  most  related  affected  reasons  had  t o t h e Crow  difficulty  In addition not a l l studies, studies,  (See Pages  in  government  were n o t  152-158).  the structures  which  affect  a r e t h e emerging  - 68 -  even i n  Formulation  introduce  identified  Five,  as t o why t h e f r e i g h t r a t e  Framework f o r P u b l i c P o l i c y  of  important  federal-provincial  a status  made a v a i l a b l e t o t h e p u b l i c .  institutions  that  of information  sections  owned  Macdonald  f e d e r a l - p r o v i n c i a l funded  previous  more  produce  includes  t o be a c c o r d e d  was no s h o r t a g e  The  The  i s t o what  by  which  of p r o v i n c i a l  t h e "farmer"  issue.  i n Chapter  there  2.1.7  favour  .The C o m m i s s i o n b e l i e v e d  communications security,  in  i n which  t h e Crow  o f more  i s made o n w h e t h e r t h e  and  policy roles  of  interest  groups  that policy  This  and t h e m e d i a  section  reviewing  obvious  i s devoted  that  influence  there  is  This  7 8  related a  thesis  the role  negotiations.  to this  paucity attempts  of  area,  of  i t  is  available  to f i l l  some o f  gaps.  Two the  to  t o examining  i n intergovernmental  the l i t e r a t u r e  documentation. these  used  development.  i n t e r e s t group a c t i v i t y In  i n being  earlier  t h e s e s have  relationship  between  been  developed  interest  which  tested  and  federal  groups  s t r u c t u r e s and p r o c e s s e s .  The Morton the  first  thesis  Grodzin.  federal  groups  since  examined  H i s Multiple-Crack  7 9  systems  the existence  policy  Multiple-Crack level  o f two  theory  i s that  o f government  against  A  levels  second  hypothesis  - 69 -  based  interest  access points to  groups  the other.  that  government,  consequence  interest  is  by  of  of  can play  the one  Grodzin developed  t h i s t h e s i s based on t h e A m e r i c a n p o l i t i c a l  The  contends  valued  provide multiple  development.  u n d e r t a k e n by  thesis  are p a r t i c u l a r l y  even w i t h s h a r e d powers, pursue  i s t h e work  on  systems.  the  work  of  R i c h a r d Simeon.  Simeon  value  systems  of federal  general  access  federalism inter-  accruing  to policy-makers,  i s such  whatever  t o groups  the  i n terms o f  the nature  negotiations,  restricted.  Limited Access Model  that  of  Canadian  t h a t , when an i s s u e e n t e r s t h e a r e n a o f  governmental  severely  concludes  8 0  is  group  H i s argument that  the  access  becomes  i n support  of the  machinery  of  inter-  governmental n e g o t i a t i o n s : " . . . l i m i t s t h e p a r t i c i p a t i o n o f i n t e r e s t groups i n the bargaining process. A f f e c t e d groups a r e n o t i n v i t e d t o p a r t i c i p a t e o r make t h e i r v i e w s known. The r e l a t i v e s e c r e c y o f d e b a t e means g r o u p l e a d e r s may be u n a w a r e o f d e v e l o p m e n t i n federal-provincial n e g o t i a t i o n s which involve . them." 8 1  Richard  Schultz  tested  hypothesis  a n d t h e more  restricted  access  groups,  by  activities Act 1967.  8  a  effectiveness of  case  study  on t h e interest  of interest  d u r i n g t h e d e v e l o p m e n t o f t h e National  group  Transportation  2  Association  1967  Multiple-Crack  general  s p e c i f i c Simeon h y p o t h e s i s  and l i m i t e d  undertaking  Schultz  Part  the  examined  the role  (CTA) i n t h e i n t e r g o v e r n m e n t a l  I I I of the Transport was  of the Canadian  being  Act.  promoted  as  - 70 -  Trucking  n e g o t i a t i o n s on  The National Transportation a  major  break  Act with  earlier  transportation  will  be d i s c u s s e d  to  the  regulations  railways,  The  (1960)  adopt  inter-modal  more  development. under  a  Transport the  This  single  1954.  Commission.  placing  The  concept of g i v i n g  the  efforts  its  side  jurisdiction. and P a r t  After  Canada  for  transportation  carrier  government  that  Canadian  had  in  outlined  t o w i n t h e CTA t o to  under p r o v i n c i a l  years of c o n f l i c t ,  probably  been  d i dnot r e l i s h  Schultz  t o stay  I I I was n o t i m p l e m e n t e d .  believe  the  t h e attempts by O n t a r i o  association  f o rthe provinces  transport  t o the provinces  up i t s a u t h o r i t y .  support  of  industry  p a r t i c u l a r l y Ontario,  five  should  responsibility f o r regulating  and l i k e w i s e examined the trucking  in  that  a l l modes  government  of the federal  as  directed  Commission  authority,  motor  by t h e f e d e r a l  the  won  framework  regulatory  The p r o v i n c e s ,  convince  MacPherson  h a d recommended  meant  extra-provincial  delegated  which,  i n C h a p t e r T h r e e , was p r i m a r i l y  Transportation a  i n Canada  the provinces  H o w e v e r , t h e CTA's  l e d the Association  to  i t g o t t h e r e s u l t i t wanted.  Based on h i s r e s e a r c h ,  Schultz  concluded that:  1. T h e Multiple-Crack h y p o t h e s i s n e e d s t o be q u a l i f i e d because i tf a i l s t o give s u f f i c i e n t weight t o t h e c o s t s o f a f e d e r a l s y s t e m f o r an i n t e r e s t group. 2. S i m e o n ' s Limited Access Model n e g l e c t s the important support function i n intergovernmental negotiations.  - 71 -  G r o u p s u p p o r t may be an i m p o r t a n t r e s o u r c e i n t h e b a r g a i n i n g p o w e r s and c o n s e q u e n t l y g r o u p s may p l a y a much more e x t e n d e d and i n f l u e n t i a l r o l e i n t h e process. 8 3  Schultz  identified  t h e need  f o r more  research  r o l e o f i n t e r e s t groups i n t h e i n t e r g o v e r n m e n t a l process.  According  multiple  access  but  bargaining  t o him, i n t e r e s t groups can e x p l o i t t h e  points  of  intergovernmental  negotiations  t h e p r i c e o f t h i s may be t o become i n t e r t w i n e d i n " t h e  v i s e of f e d e r a l i s m " .  8 4  S i n c e t h e e a r l y 1970s, t h e r e has been renewed in  on t h e  examining  Canadian  federal  relations  Macdonald  Labor  Study  and  by  to  access. successful  the  Bucovetsky  of  rival  t o Hugh  h i s work  f o r the  system,  and  Bucovetsky.  of  the  will  the  Canadian  National  Trade  representing the  to different  provincial  - 72 -  multiple-crack  between  government how  the  groups,  access  shows  i n mobilizing  according  Kravnick  the Confederation  federal  level  for  the c o n f l i c t  but having  in a  In  8 5  evidence  t o demonstrate that  government  i n the  on t h e Economy, 1 9 8 5 , T h o r b u r n  Studies uses  groups  analysis of the i n t e r -  remains,  unexplored".  further  Case  interests  power  However,  Commission  Congress  Unions, same  Royal  in  Kravnick's  system.  "largely  identify  theory  and s c o p e o f i n t e r e s t  o f t h e two d y n a m i c s  Thorburn,  did  the role  interest  levels  attempt  to which mining  of  to  shift  they  enjoy  industry  governments  was  against  on T a x a t i o n .  t h e p r o p o s a l o f t h e C a r t e r Commission  The work  third  case  already  demonstrates substantive  policy  how case  of  has  study  basis  to  builds  I t examines and  as a t e s t  f o r Crow  federal  Rate  reform,  government  examine  and  the  i n v o l v e d t o c r e a t e b o t h an i n s i d e interest Crow R a t e  groups  and g o v e r n m e n t s  settlement.  studies  attempt  was  role  a of  of  and  public  scope  groups  of to  t o change t h e  the a p p l i c a b i l i t y  hypotheses.  The k e y  t h e agreement  between  major  interest  and o u t s i d e  groups  category f o r  i n the negotiation  These n e g o t i a t i o n s  t h e form o f a model i n Chapter  on  system.  the role  Limited Access  and  the  transportation  to further  clearly  completed  examine  government's  i s the  This  been  on t h e e a r l i e r  the federal  t h e Mutiple-Crack  feature the  work  agricultural  Crow R a t e ,  Schultz.  little  formulations.  influence  by  by Thorburn,  i n the Canadian f e d e r a l  thesis  western  discussed  discussed  i n t e r e s t groups  This  study  8 6  of a  are developed i n  Five.  Summary This political  section  outlines  system  and  public policy  the structure  provides  some  i s f o r m u l a t e d i n Canada.  - 73 -  of the Canadian  insight  as  to  how  The with that  traditional  concept  of  p r o v i n c e - b u i l d i n g appearing review.  provincial  The  ongoing  governments  federalism  between  identified  phenomenon t o be a n a l y z e d i n i t s own  The  Canadian  Cabinet  historical  role  that  "regional"  this  of  system  the regional  l a r g e extent performed  role  has  documented  between  c a n be v i e w e d  the years  federal  as  a  i s analyzed minister. been  and  distinct  as  i s the  It is  overtaken  argued  and  to  a  Premiers.  Party i n western  1953 and 1 9 8 0 .  as p a r t o f a l a r g e r  theme i n  right.  by p r o v i n c i a l  The d e c l i n e o f t h e L i b e r a l  reviewed  as an i m p o r t a n t  conflict  is  is  phenomenon  Canada i a  This  decline  i . e . , absence  o f a l l f e d e r a l p a r t i e s t o be r e p r e s e n t e d i n e v e r y p r o v i n c e .  The Council  roles  of the central  Office  are reviewed  c o o r d i n a t i o n o f government concluded  that  since these  programs  t h e PMO/PCO h a v e  regional ministers i n direct Ministers  agencies  and  with  as t h e P r i v y  agencies  and p r i o r i t i e s .  become  conflict  provincial  such  provide Itis  the equivalent of  with federal  Premiers  in  Cabinet national  d e c i s i o n making.  The  chapter  also  introduces  - 74 -  the  role  of  special  i n t e r e s t g r o u p s and t h e m e d i a The  interactive  federalism recently closed This  a  central  and  restricted longer  policy  of  policy  this  prepared  to  support of t h e i r  The  next  government  in  groups  thesis.  p r o c e s s was  federal-provincial  t h e c a s e and  to exploit  development.  interest  interest  d e g r e e by t h e e x p o s u r e s u p p l i e d  able  national  theme  to  As w e l l ,  mobilize  each  interest  and Until  relatively interaction.  groups, thanks to by t h e media,  t h e c o n f l i c t between  p r o v i n c i a l governments. is  between  the Canadian p u b l i c  i s no  a large been  is  effects  i n public  the f e d e r a l  l e v e l of groups  have and  government  actively  in  positions.  chapter Canada  transportation  discusses interact  to  policies.  - 75 -  how  the  develop  two and  levels  of  implement  Page 1 of 6 NOTES  1 Arthur Maass, Area and Power: A Theory of Local Government. The Free Press, Glencoe, Illinois, Chapter 1,1959. 2john Picker and John Saywell with Alan Skeoch, How we are Governed in the 1980s. Clarke Irwin and Co., Ltd., Toronto, 1982, p. 118. 3  Ibid. p. 119.  ^Christopher Armstrong, The Politics Press, Toronto, 1981, p. 34.  of Federalism.  University  of Toronto  $Hugh G. Thorburn, Interest Groups, p. 17. 6Alan Cairns, "The Other Crisis of Canadian Federalism", Administration. Vol. 22, No.2, 1979, p. 180.  Canadian  Public  ?Garth Stevenson, "Federalism and Intergovernmental Relations" in Canadian Politics in the 1980s, edited by Michael S. Whittington and Glen Williams, Methuen, Toronto, 1981, p. 276. &Roger Gibbins, Prairie Politics and Butterworth, Toronto, 1980, p. 2.  Society:  Regionalism  in  Decline.  ^Emile Durkheim, The Divisions of Labour in Society, quoted in Roger Gibbins' Prairie Politics, p. 3. lORoger Gibbins, Prairie Politics, p. 3. HEdwin Black, R. and Alan Cairns, "A Different Federalism", Canadian Public Administration. quoted in Roger Gibbins' Prairie Politics, p. 3.  Perspective on Canadian Volume IX, March 1966,  l^Roger Gibbins, Prairie Politics, p. 3. HGarth  Stevenson, "Federalism and Intergovernmental Relations" in Canadian Politics in the 1980s, edited by Michael S. Whittington and Glen Williams, Methuen, Toronto, 1981, p. 290.  ^Richard 15  16  Simeon, Confrontation and Collaboration, p. 7.  Ibid. p. 7.  Alan  Cairns, "The Other Crisis of Canadian Federalism", p. 194.  - 76 -  Page 2 of 6 NOTES  ^Richard Simeon, Federal Provincial Diplomacy. University of Toronto Toronto, 1972, p. 230.  Press,  Westmacott and P. Dbre, "Intergovernmental Cooperation in Western Canada: The Western Economic Opportunities Conference" in Canadian Federalism: Myth or Reality, edited by J. Peter Meekison, Methuen, Toronto, 1977, p. 343. l^Hugh  G. Thorburn, "Interest Groups in the Canadian Federal System", A Background Report, Volume 69 prepared for the Royal Commission on Economic Union and Development Prospects for Canada. University of Toronto Press, Toronto, 1985, p. 113-114.  ^Richard Simeon, Confrontation and CollaborationIntergovernmental Relations in Canada Today, the Institute of Public Administration of Canada, Toronto, 1979, p. 7. E. Hodgetts, "Regional Interests and Policy in a Federal State", in J. Peter Meekison op. cit. p. 285. 22  Ibid. p. 285.  23Edwin R. Black and Alan Cairns, "A Different Perspective Federalism", in J. Peter Meekison, ed., op. cit. p. 83.  on Canadian  E. Hodgetts, op. cit. p. 285. $Garth  2  26  2  Stevenson, Unfulfilled 174.  Union. Gage Publishing Ltd., Toronto, 1982, p.  Ibid. Page 174.  ?Richard Simeon, Federal-Provincial Toronto, 1972,p. 172.  Diplomacy. University of Toronto  Press,  &Jean-Luc Pepin, "Cooperative Federalism", The Canadian Forum. Dec, 1964, p. 206.  2  ^Personal  Interview - Jean-Luc Pepin, February 09. 1982.  ^Stefan J. Dupre, "Reflections on the Workability of Executive Federalism", in Division of Powers and Public Policy. Vol. 61, edited by Richard Simeon. Macdonald Royal Commission, 1985, p.2.  NOTES  ^Audrey D. Doerr, The Machinery Toronto, 1981, p. 181.  3  of Government  Page 3 of 6  in Canada.  Methuen,  ^Frederick J. Fletcher and Donald C. Wallace, "Federal-Provincial Relations and the Making of Public Policy in Canada: A Review of Case Studies," for Divisions of Powers and Public Policy, edited by Richard Simeon for the Macdonald Roval Commission on the Economic Union and Development Proposects for Canada. Vol. 61. University of Toronto Press. Toronto. 1985. p. 154. 33  Ibid. p. 154.  34  Ibid. p. 154.  35  Ibid. p. 155.  &Audrey Doerr op. cit p. 181  3  3  ^Ian D. Clark, "Recent Changes to the Cabinet Decision- Making System in Ottawa", Canadian Public Administration. Vol. 28, No. 2, 1985, p. 201.  38  Ibid. p. 188.  ^David  3  E. Smith, "The Federal Cabinet in Canadian Politics" in Canadian Politics in the 1980's: edited by Michael S. Whittington and Glen Williams, Methuen, Toronto, 1984, p. 353.  Wlan D. Clark, op. cit.. p. 187. 41  Ibid. p. 190.  David  42  43  W.  E. Smith, op. cit.. p. 355.  A. Matheson, The Prime Minister and the Cabinet. Methuen, 1976, p. 97.  Toronto,  44p ter Aucoin and Herman Bakvis, "The Case of Regional Economic , Development in Canada", in Regional Responsiveness and the National Administrative State, edited by Peter Aucoin, Vol. 37, (Royal Commission on Economic Union and Development Prospects for Canada) University of Toronto Press, Toronto, 1985, p. 51. e  45Richard Simeon, "Regionalism and Canadian Political Institutions", p. 299.  - 78 -  Page 4 of 6  NOTES  46Alan Cairns, From Interstate to Intrastate Federalism in Canada. Institute of Intergovernmental Relations, Queen's University, Kingston, 1979, p. 6. 47  John  C. Courtney, The Canadian House of Commons - Essays in Honour of Norman Ward, the University of Calgary Press, Calgary, 1985, p. (xiii).  ^Ibid. p. (xiii). 4&W. A. Matheson, The Prime Minister and the Cabinet, pp. 238-39. ^Richard Simeon, "Intergovernmental Relations and the Challenges to Canadian Federalism", Canadian Public Administration. Vol. 23, 1980, p. 15. 5^David E. Smith, "Cabinet and Commons in the Era of James G. Gardiner" in the Canadian House of Commons, pp. 76-7. 52  Ibid. p. 76.  53  Ibid. p. 79.  54  Ibid. pp. 79-80.  55Alan Tupper, "Mr. Trudeau and the West", Western Separatism, edited by Larry Pratt and Garth Stevenson, Hurtig Publishers, Edmonton, 1981, p. 91. 5&David E. Smith, The Regional Decline of a National Party: Prairies. University of Toronto Press, Toronto, 1981.  Liberals on the  5?Barry Wilson, Politics of Defeat - The Decline of the Liberal Party Saskatchewan. Western Producer Prairie Books, Saskatchewan, 1980. 58  Macdonald  in  Report. Vol. 11, Table 7-27.  59Alan Cairns, "The Governments and Societies of Canadian Federalism", p. 1. ^Thorburn,  H. G., Planning and the Economy, p. 63.  GlColin  Campbell, Government Toronto, 1983.  Under Stress. University  of Toronto  62colin  Campbell and George Szablowski, The Super Bureaucrats. Toronto, 1979, p. 1.  6han D. Clark, "Recent Changes in Cabinet Decision-Making", p. 198.  - 79 -  Press,  MacMillan,  NOTES  Page 5 of 6  G^Doern and Phidd, op. cit. p. 75. 65paul  A. Pross, "Pressure Groups: Adaptive Instruments of Political Communication". In Pressure Group. Behaviour in Canadian Politics, edited by A. Paul Pross, McGraw-Hill Ryerson, Toronto, 1975, p. 2.  ^Donald V. Smiley, "An Outsider's Observations of Federal-Provincial Relations Among Consenting Adults". In Confrontation and Collaboration by Richard Simeon, p. 179. ^Frederick J. Fletcher and Donald C. Wallace, "Federal-Provincial Relations and the Making of Public Policy in Canada: A Review of Case Studies". In Division of Powers and Public Policy, edited by Richard Simeon, prepared for the Royal Commission on Economic Union and Development Prospects in Canada. Vol. 61, 1985, p. 128. 68  Ibid. v. 178.  69  Ibid. p. 178.  70  Ibid. p. 178.  71  Ibid. p. 178.  72  73  Ibid. pp. 178-179.  Ibid. p. 181.  Jim  74  Forbes, "Institutions and Influence Groups in Canadian Farm and Food Policy", Institute of Public Administration for Canada. Monograph No. 10, 1985.  ^Doern and Phidd, op. cit. p. 547.  7  7  ^Ricker,  Saywell and Skeach, op. cit. p. 98.  lbid.  p. 100.  The  most quoted earlier works involve, Morton Grodzini "The Federal System", in A. Wildavsky (ed.), American Federalism in Perspective. Little Brown, Boston, 1976, and Robert Prosthus' Elite Accommodation in Canadian Politics. MacMillan of Canada, Toronto, 1923, and Paul Pross (ed.), Pressure Group Behavior in Canadian Politics, McGraw-Hill, Toronto, 1925.  77  78  - 80 -  NOTES  ^Morton  Grodzin, "The Federal System", op. cit.  ^Richard Simeon, Federal-Provincial Toronto, 1972. 81  82  Diplomacy. University of Toronto Press,  Ibid, p. 144..  Richard Schultz, "Interest Groups and Intergovernmental Negotiations: Caught in the Vise of Federalism" in J. Peter Meekison (ed.) Canadian Federalism: Myth or Reality. 3rd edition, Methuen, Toronto, 1977, pp. 375-396.  83  Ibid, p. 394.  84  8  Page 6 of 6  Ibid, p. 394.  $Hugh Thorburn, Interest Groups in the Canadian Federal System. Volume 61 for the Royal Commission on Economic Union and Development Prospects for Canada, University of Toronto Press, Toronto, 1985.  86  Ibid, p. 62.  - 81 -  CHAPTER THREE  THE DEVELOPMENT OF NATIONAL TRANSPORTATION POLICY  3.0  Introduction  It portation  i s necessary policy  opportunity federal  i n Canada  t o assess  state.  responsibilities  to trace  the evolution  because  t h e problems  The  chapter  of  i t provides  trans-  an  ideal  of policy-making  in a  outlines  b e t w e e n t h e two l e v e l s  the  shared  o f government and  d i s c u s s e s some o f t h e p r o b l e m s t h i s h a s c r e a t e d .  The  chapter  Confederation  presents  On t h e o n e h a n d ,  efficient  and h i g h  the other  national  argument  t h e Canadian t r a n s p o r t system  purpose.  on  an  hand,  level  i t i s expected  service  i t i s expected  that  since  has had a d u a l to provide  at "reasonable"  an  c o s t and  t o be a n " i n s t r u m e n t o f  purpose."  Included  i n the chapter  r a i l w a y development  i s a  historiography of  and t h e c o n c o m i t a n t  emergence o f g r a i n  - 82 -  handling  and t r a n s p o r t  The  evolution  reference it,  t o many  will  placed  also  problems.  of national  of the contrasting  be o u t l i n e d  on t h e r o l e  transport  The the  in  chapter begins with  by  significant Canadians. Soviet  imposed  upon  Emphasis i s  and g o v e r n m e n t s '  a context  of transportation  i s common t o b e g i n  Canada  with  chapter.  and l e g i s l a t i o n  The C a n a d i a n T r a n s p o r t a t i o n  It  roles  policy,  prime  - t o d o c u m e n t how  p o l i c y has e v o l v e d s i n c e 1867.  unique features  3.1  i n this  o f governments  instruments - regulation the  transportation  invoking  a  Union)  with  to identify  i n Canada.  System  any r e f e r e n c e  transportation Canada's  section  hyperbole is  to  to the  immense t e r r i t o r y a population  to transportation describe  how  well-being  of  (second  of only  only  to the  25 m i l l i o n ,  is  r e a l l y a n "empty c o u n t r y " , w h i c h p o s e s a n awesome r o l e o n 1  the  transport  miles  between  Newfoundland that  2  system  t o move g o o d s  Victoria,  and t h r o u g h  as t h e w o r l d ' s  British s i x time  seventh  and p e o p l e  Columbia zones.  largest  depends h e a v i l y on i t s t r a n s p o r t a t i o n  - 83 -  over  4,000  and S t . J o h n s , I t c a n be  trading nation system.  said  Canada  As a r e s u l t ,  "...on  a  per  capita  railway  mainline  40  cent  per  the  basis,  ( 1 9 7 1 ) as  more m i l e s  Science  Canada  Council  does the  of  of  has  United  surfaced  Canada,  possible  perspective, were  to  state  moved  and  607  not  until  alone  i t should  May,  highway years  across  Canada  through there  1971  that  system,  twenty  ago  possible  no to  a  was  that  million  be  t r a v e l by  bus bus  owned  by  freight intercity  and  that  will  Winnipeg, Even  today  although  between V i c t o r i a ,  B.C.,  require  companies.  than  eastward  of  Detroit.  was yet  less  route  and  i t  highway,  south  company  different  is  demand  of  I t was bus  diversion  John's, Newfoundland, such a t r i p transfers  out  national  national  Chicago  national  pointed  established.  a  the  5  single  the  included  Minneapolis, is  325  to  It  4  derived  tonnes  1983.  also  a  has  is  world."  million  approximately  passenger t r i p s were taken i n  However,  from  and  country  i n the  of  According  3  "...this  that,  approximately  States  road."  s e c o n d most a c t i v e a v i a t i o n c o u n t r y also  many more m i l e s  i t and  St.  several  In  1940  is  bus  about  150,000 p e r s o n s u s e d c o m m e r c i a l p l a n e s  i n Canada.  In  about  the  figure)  28.5  passengers still  million were  impossible  western  (almost  carried to  provincial  by  double  commercial  f l y direct capitals  - 84  airlines,  between  and  any  -  of  1970  any the  of four  yet the  1984  i t is four  Atlantic  provincial  capitals.  In  other  words,  t r a n s p o r t a t i o n system i s a c o l l e c t i o n  The  system  efficient  has as w e l l  with the result  that the r a i l  the passenger  In  turn,  of  a l l i n t e r c i t y passenger  surprising 1.2  when  one  million  million  o f low v a l u e ,  traffic  7 million  3.1.1  today.  bulk  i n Canada,  commodities.  considers 7  AS  that  in  This  6  1940,  i s not  Canadians  and t o d a y t h e y own a p p r o x i m a t e l y a  result,  passenger  travel  passengers  on  i n 1940  8  9  Railway Ideology  It  i s not d i f f i c u l t  t r a n s p o r t a t i o n system one  changes  a t one t i m e p r o -  i n 1983.  r a i l w a y s h a s d e c r e a s e d f r o m 22 m i l l i o n to  system.  structural  mode, w h i c h  above  c a r was r e s p o n s i b l e f o r 85 p e r c e n t  cars ,  cars.  major  immature  and p a s s e n g e r s e r v i c e s  i s now p r i m a r i l y a c a r r i e r  11.0  of contrasts.  and a l i m i t e d ,  undergone  vided the bulk of freight  owned  Canadian  t r a n s p o r t a t i o n s y s t e m i n C a n a d a as i n d i c a t e d  i s both a large, The  the  attempts  evolution railway  t o understand  is full  of c o n f l i c t i n g  t o p r o v i d e an h i s t o r i c a l  of national development  transportation i s often  why  cited  - 85 -  the  Canadian  d u a l i s m s when  perspective  policy. as  one  on t h e  A  plan f o r  of  t h e key  e l e m e n t s o f J o h n A. M a c D o n a l d ' s N a t i o n a l it  i s becoming  considerable  increasingly  mythology  evident  surrounding  Policy.*  that  both  there  However, has been  the formation  and  purpose o f t h i s p o l i c y .  Gerald regional  Friesen, history  contemporary just  who h a s r e c e n t l y of  position  the creation  the that  o f John  prairies,  was  and t h e f i r s t  two  is  MacDonald before  According  i n t e r e s t s who w o r k e d regions  benefited  no a c t u a l d a t e when t h e N a t i o n a l  Friesen  states  Confederation "...itself  that (1867)  was a p l a n k  make t h e n a t i o n penalized Canada. growth  National since  the outlying According  and  investment.  Harold  to Friesen, i t  together  he a r g u e s  regions  to Friesen  t h e Canadian  There  P o l i c y was e s t a b l i s h e d .  Policy  but their  t o ensure  c e n t r a l Canada.  i s synonymous that  efforts to  e f f o r t s may a l s o  to the benefit businessmen  northwest  was  with  Confederation,  i n t h e entrepreneurs'  "strong"  a  but rather  a f t e r Confederation.  theoutlying  from  A.  generations  that  argues  P o l i c y , was n o t  i n the generation  the business  the f i r s t  the National  established  was  produced  have  of central  needed  economic  the field  of  1 0  Innis  1 1  (author  of  the  staple-hinterland  *The National Policy encompassed railways and settlements, tariffs, freight rate agreements, Native treaties and the Northwest Mounted Police (law and order in the west). - 86 -  t h e o r y ) and p r a i r i e e c o n o m i s t Vernon F o w k e that National the  Tariff  volorem  of  P o l i c y was t h e r e s u l t o f t h e e s t a b l i s h m e n t  i n 1879.  on each  immediate  and  from  States. three  benefitted  Innis  paid  believed  that  National  Policy  work  Donald  of  described  i n population  higher  t h e 1879 t a r i f f  because  of  transcontinental  agreement design National tariff large that  Policy. produced  of the  to Friesen  and u n a c c e p t a b l y the tariff  that  t h e economy  economic  labourer.  element  Today,  who  i n National  there  MacDonald  that  and  t h e wage  Dr.  Ken N o r r i e has argued t h a t  the  industrialization of the p r a i r i e s .  i s no  had a  o f Canada  grand  through h i s  that  t h e 1879  was  too fast, too  Fowke  has suggested  against  the prairie  times A l b e r t a  the tariffs  - 87 -  1950s  fixed to the construction  inefficient.  I n recent  i t was t h e  1 4  and  has argued  growth  discriminated  and  was t h e l y n c h p i n  railway.  Dales  Ontario  goods".  as a c r u c i a l  John  t o the United  i n t h e 1940s  historians  to integrate  shift  f o r "Canadian  i t was s o c l o s e l y  among  umland).  number o f j o b s  as n o r t h e r n  b u t , according Creighton  the  o f t h e f o u r w e s t e r n and  prices  the tariff  Policy a  as w e l l  1 3  ad  regions  and M o n t r e a l  from t h e increased  provinces  Quebec  to Friesen  the manufacturing  (Toronto  of  a 15 p e r c e n t  According  time t h e i n h a b i t a n t s  maritime  northern  time  t h e decrease Over  item.  added  was t o b e n e f i t  at that  These r e g i o n s  The t a r i f f  imported  result  Canada  a r g u e d i n 1957  1 2  1 5  did  region  economist  not i n h i b i t  The  tariff  regions it  outside  i s true  tariff  that  outside  support  Montreal  tariff  from today  the  of  Not  true  that was  the United  i n western  Canada  as d o e s  between  other  of  Policy.  Robert  the  but t h i s  was a t  i s no  federal  In other same  i n Ontario.  which  affect  and  words,  "benefit" Ironically non-tariff  the m o b i l i t y of  i n Canada.  a l l students  position  not  t h e m s e l v e s have c o n s t r u c t e d  each  and l a b o u r  border!  industry  could  i n existence i n  There  receives  The  of the Toronto  artificial  States.  from the  Canada.  centres  as t h a t  some  the Ontario-Manitoba  the provinces  capital  population  the  i n t e n t i o n a l l y but  i n western  a t t h e same s c a l e  the t a r i f f  barriers  major  against  b e n e f i t t e d more  did cities  industrialization  at  industry  than  I t i s also  expense  and M o n t r e a l  t h e s e two c i t i e s  industry  Toronto.  d i d not d i s c r i m i n a t e  of Toronto  structure  areas  the  itself  the t a r i f f Chodos  of as  Canadian the  believes  the Canadian P a c i f i c Railway  history  centrepiece  support of  National  the date of completion  (1885):  ...is a more a p p r o p r i a t e p o i n t f r o m w h i c h t o d a t e o u r e x i s t e n c e as a c o u n t r y t h a n 1 8 6 7 . A l l t h a t happened a t C o n f e d e r a t i o n was t h a t three B r i t i s h c o l o n i e s g o t t o g e t h e r and s e t up a new l e v e l o f government. The i d e a o f C a n a d a a s a nation made l i t t l e sense without the great n o r t h w e s t and C a n a d a ' s h o l d o v e r t h e n o r t h w e s t was e x t r e m e l y t e n u o u s w i t h o u t a railway.  - 88 -  the  of  T h e r e w o u l d be a c o u n t r y and w h a t k i n d o f c o u n t r y i t w o u l d be was r e a l l y o n l y d e c i d e d on November 7, 1 8 8 5 . 1 6  In -  support  o f C h o d o s , E. J . P r a t t w r o t e ,  the driving  of the last  C h o d o s makes an c o m p e l l i n g an  artificial  east-west  natural  north-south  further  argues  spike  - closed  a  gavel  off debate."  a r g u m e n t when he w r i t e s  1 7  that i f  c o n n e c t i o n had n o t been b u i l t , t h e  connections  that  "...like  without  would  have  t h e CPR  prevailed.  the p r a i r i e s  He  would  have been drawn i n t o t h e o r b i t o f t h e A m e r i c a n m i d - w e s t e r n states ten  (Map on P a g e  years  of  the  189).  Chodos  building  of  admits the  p o s s i b l e w i t h o u t damage t o C a n a d i a n  The  myth  P a g e 101 play next  the  havoc  t h e CPR  government  was  expectations  with  period and  provincial  of  national  hundred years.  acrimonious  ten  of  initially  CPR  born  a n d , as  railway  also  been  outlined  development policy  on  would  f o r the  s i g n a l t h e s t a r t o f an between  the seven over  have  of  nationhood.  conflict  governments  a delay  may  transportation  I t would of  that  and  the  federal  subsequently  national  the  transportation  policy.  3.1.2  The C o n s t i t u t i o n and  Federal  and  Transportation  provincial  powers  - 89 -  contained  in  the  Constitution purpose broad  have  powers  to the federal  appears,  to  the central there  power  of granting  towards  Constitution  as  (1867)  has t h e  which  control  However,  a transformation  and w i l l  assess  This  as a l r e a d y of t h i s  section  pointed  sharing of  analyzes  how t h e s e  powers have  Figure 2: Federal and Provincial Powers provided  gave  o f t h e economy  r e s p o n s i b i l i t i e s have been a l l o c a t e d  o f powers  (Section  extensive  the provinces.  the present.  kinds  discussed  government w i t h t h e i n t e n t i o n ,  government.  has been  transportation  to  been  of the o r i g i n a l Constitution,  it  out,  already  t o both  the federal  91) and t h e p r o v i n c i a l g o v e r n m e n t s  how  by t h e evolved  l i s t s the government  ( S e c t i o n s 92,  93) .  It that  i s both  over  the general  c o m m u n i c a t i o n s on e i t h e r  Legislatures". transportation and  and s i g n i f i c a n t t o p o i n t o u t  t h e Constitution Act, (1867) d o e s n o t , " . . . e x p r e s s l y  jurisdiction or  interesting  91(29)  jurisdiction  Federal  1 8  the  Parliament  based  Constitution  t o Parliament  of  over  " i n t e r p r o v i n c i a l undertakings".  - 90 -  on Act,  what  transportation  or the provincial  jurisdiction  i s primarily of  headings  confer  i n t h e areas  of  subsections  92(10)  1867  assign  have  As w e l l :  which become  known a s  FEDERAL AND  PROVINCIAL P O W E R S  FEDERAL  PROVINCIAL  9 1 . It shall be l a w f u l for t h e Q u e e n , by a n d w i t h t h e A d v i c e a n d C o n s e n t of t h e S e n a t e a n d H o u s e of Comm o n s , t o m a k e Law,s f o r t h e Peace, Order, a n d g o o d G o v e r n m e n t of C a n a d a , in r e l a t i o n t o all M a t t e r s not c o m i n g w i t h i n t h e C l a s s e s of S u b j e c t s by t h i s A c t a s s i g n e d exc l u s i v e l y t o t h e L e g i s l a t u r e s of t h e Provinces;...  92.  ... 1. T h e A m e n d m e n t . . .of t h e C o n s t i t u t i o n . . .except a s regards the Office of LieutenantGovernor 2. Direct T a x a t i o n w i t h i n t h e Province... 5. T h e M a n a g e m e n t a n d Sale of t h e Public L a n d s . . . 8. M u n i c i p a l I n s t i t u t i o n s in t h e Province 9. S h o p , S a l o o n , Tavern, Auctioneer, a n d other l i c e n c e s 10. Local W o r k s a n d U n d e r t a k i n g o t h e r t h a n s u c h as are of t h e following Classes: a) T r a n s p o r t a t i o n f a c i l i t i e s linking t w o provinces b) T r a n s p o r t a t i o n f a c i l i t i e s linking Canada and other countries c) F a c i l i t i e s w h i c h t h e Parliam e n t of C a n a d a d e c l a r e s t o be for t h e w e l f a r e of C a n a d a or m o r e t h a n t h e single province. 12. T h e S o l e m n i z a t i o n o f Marriage. . . 13. Property a n d Civil r i g h t s . . . 14. T h e A d m i n i s t r a t i o n of Justice. . . 16. G e n e r a l l y all M a t t e r s of a m e r e l y local or private . Nature... 93. In a n d f o r e a c h Province t h e legislature m a y e x c l u s i v e l y m a k e l a w s in r e l a t i o n t o E d u c a t i o n  [ILLUSTRATIONS] 1. T h e Public Debt a n d Property 2. T h e R e g u l a t i o n of Trade a n d Commerce 3. T h e raising of M o n e y by any M o d e or S y s t e m of T a x a t i o n 5. T h e Postal Service 7. M i l i t i a , M i l i t a r y a n d Naval Service, a n d Defence 10. N a v i g a t i o n a n d S h i p p i n g 12. S e a C o a s t a n d Inland Fisheries 14. C u r r e n c y a n d C o i n a g e 15. B a n k i n g . . .and t h e Issue of Paper M o n e y 24. I n d i a n s a n d L a n d s reserved for Indians 25. N a t u r a l i z a t i o n a n d A l i e n s 26. M a r r i a g e a n d Divorce 27. T h e C r i m i n a l Law  Source: How  S a y w e l l , John e t a l We A r e G o v e r n e d i n t h e  -  91  -  1980's,  1982  ...the power contained i n t h e preamble t o s e c t i o n 91 o f t h a t A c t t o make l a w s f o r t h e ' p e a c e , o r d e r and good g o v e r n m e n t o f C a n a d a ' has also provided a source of federal jurisdiction. In addition, certain specific modes of transportation are identified in s u b s e c t i o n s 9 1 ( 9 ) , ( 1 0 ) and ( 1 3 ) o f t h e A c t a s being subject to exclusive federal jurisdiction. 1 9  Provincial  jurisdiction  over t r a n s p o r t a t i o n :  ...has g e n e r a l l y been based on subsections 9 2 ( 1 0 ) , ( 1 3 ) and ( 1 6 ) o f t h e Constitution Act, 1867, c o n f e r r i n g power t o l e g i s l a t e w i t h r e s p e c t t o ' l o c a l w o r k s and u n d e r t a k i n g s ' , ' p r o p e r t y and c i v i l r i g h t s w i t h i n t h e p r o v i n c e ' and ' m a t t e r s of merely l o c a l or p r i v a t e nature w i t h i n the province.' 2 0  There  have  above  quotation.  review  b e e n many j u d i c i a l  another,  province,  over  2 1  Commission,  undertakings  or extending  of t h e wording  and D u n b a r  f o r t h e Macdonald  jurisdiction with  Dalfen  tests  i n their  judicial  defined  connecting  beyond  i n the  the limits  one  federal province  of a  as f o l l o w s :  If an u n d e r t a k i n g engages in a significant degree of continuous and regular interprovincial activity, i t will fall within federal jurisdiction. I f t h e a c t i v i t i e s o f an o t h e r w i s e l o c a l u n d e r t a k i n g form an i n t e g r a l and n e c e s s a r y p a r t o f an interprovincial undertaking, the local under-taking w i l l also f a l l subject to federal jurisdiction.  - 92 -  single  At  this  over  stage  i t i s necessary  the various  aeronautics,  modes  railways  t o consider  of transport  jurisdiction  such  and m o t o r v e h i c l e  as  shipping,  transportation.  Shipping  Marine pursuant that  transportation  to a  includes  Harbours  Board  Transportation Act, Act,  Act,  rates,  This  registration  local  Provincial  Shipping  of  exercised legislation  Act,  t h e National  Act,  Act  National  the  t h e Shipping Conferences  Seaway Authority  t o regulate  harbours.  Canadian  the  is  pieces  Waters Protection  t h e Pilotage Act,  Act.  government  of specific  t h e Navigable  t h e St. Lawrence  Transport  or  number  regulation  Exemption  a n d t h e Department of  legislation  enables  the  federal  navigable  waterways,  the  shipping  of vessels,  pilotage  and t h e u s e o f  covers  intra-provincial  jurisdiction  shipping.  Aeronautics  The on,  federal  Parliament's  jurisdiction power  government'  pursuant  t o t h e Aeronautics  The  federal  aeronautics  i s based  t o make l a w s f o r t h e ' p e a c e ,  and g o o d  Act.  over  o f Canada. Act  government  Aeronautics  i s regulated  a n d t h e National has  - 93 -  order  established  Transportation exclusive  jurisdiction affect  in  a l l  undertakings and  transportation.  carriers,  and  consistent  regulatory  air  local  a l l other  authority  and  activities  to aeronautics  Its  intraprovincial  considered  i n Canada.  i s exerted  by  regulations  a  integral  This  extensive  single  regulatory  body, t h e A i r T r a n s p o r t Committee o f t h e C a n a d i a n T r a n s p o r t Commission  (CTC)  and  a  single  federal  Department  of  Transport.  Air its  passenger  e a r l y days o f e x i s t e n c e  over  the  market  restrictive the  forces  p r a c t i c e and  a i r industry since  trend  to  airlines pales  and  was  of  the  despite  subject  Despite  the  this  growth of  h a s n o t b e e n an e n d u r i n g  conflict.  but  since  regulation  t h e phenomenal  provincial  example  the  industry.  1940, t h e r e  the  one  been  t o t i g h t government  i n comparison to that  rail  has  federal-provincial  differences  and  transport  There  ownership magnitude  associated  with  have  of  been  regional  of  conflict  the  railways  and  CP  freight rates.  Railways  Canada's which  handle  declared,  two 90  major  per cent  "...works  or  railways, of  rail  CN  Rail  f r e i g h t , have b o t h  undertakings  for  the  Rail been  general  advantage  o f Canada",  jurisdiction. Rail  2 2  Prior  Transport  Commission Transportation and  the  intraprovincial  to  of  Grain  railways  subject  were  the  to federal  regulated  Canadian  the provisions  t h e Railway Act,  Western  fall  t o 1988 t h e y  Committee  pursuant Act,  and hence  by t h e  Transport t h e National  of  t h e Maritimes Freight Rates Act  Transportation such  Act.  a s BC R a i l  Local  or  are provincially  regulated.  Prior  t o 1967, t r a n s p o r t a t i o n  C a n a d a h a d become o s s i f i e d left-overs monopoly the  from  faced  freight  Commission  severe competition  following  passage  railways  were a b l e  rapidly  as market  rate policies  railroads  shipments. recognized  from other  t o change t h e i r conditions  One a f f e c t e d  at  fixed  grain  a near-  However  i n  that  1959  the railways  modes a n d a s a r e s u l t ,  rates  Act, (1967) t h e  and p r a c t i c e s as  demanded. rates  were  enjoyed  o f t h e National Transportation  w e r e made. levels  as f r e i g h t  t h e 1920s when  of overland  MacPherson  2 3  l a w and r e g u l a t i o n i n  which  Two  exceptions  remained  i n 1898 a n d 1899 a n d r a t e s  frozen  affecting  c o m m o d i t i e s m o v i n g u n d e r t h e Maritime Freight Rates Act.  3.1.3  R a i l w a y Development To  appreciate  why r a i l w a y  freight  - 95 -  rates  were  such  a  high and  profile  issue v i s a v i s a i r transport  t o provide  issue,  this  section  development prairie  railway  in  have  Canadians  National  with  o n t h e Crow  overview  particular  Rate  of  railway-  reference  to the  b e e n many b o o k s w r i t t e n o n t h e h i s t o r y o f  a  that  "romance  The themes  2 4  rail  Canadian  with  In  the railways". books  1985, t h e M i n i s t e r  returning  to that  passenger  services.  Northern  a r e always t h e  t r a v e l have d e v e l o p e d  one o f t h e more r e c e n t  Dream.  about  economic  its  i n Canada  an  R a i l r o a d b u i l d i n g and r a i l r o a d  talked  the  provides  building i n Canada.  surprising The  perspective  issues  provinces.  There  same.  an h i s t o r i c a l  related  Railways  romance  I t i snot was  of  entitled Transport  by r e s t o r i n g un-  I n 1896 c o n s t r u c t i o n o f  began  and t h e romance o f  c o n s t r u c t i o n was f i t t i n g l y d e s c r i b e d  b y 0. S. S k e l t o n :  "In 1896 a r a i l w a y , a hundred m i l e s long, beginning and e n d i n g nowhere, operated by t h i r t e e n men and a b o y ! I n 1914, a great transcontinental system p r a c t i c a l l y completed over t e n thousand miles ( s i c ) i n l e n g t h and c o v e r i n g seven o f Canada's n i n e p r o v i n c e s ! The i m p o s s i b l e had been a c h i e v e d . " 2 5  This  romance i s even  popular  Canadian  carried  folk  o u t i n song  singer  - 96 -  Gordon  as p e r f o r m e d Lightfoot  by  who,  "...sings could  of the railway  build  t h e mines,  use o f a l l . "  Like  2  being constructed  mills  s o many  building  construction periods: 1917;  and f a c t o r i e s  others  f o r t h e good  6  features  o f Canadian  myth t r i u m p h s o v e r r e a l i t y . railroad  so t h a t  the first  and t h e t h i r d  T a b l e 2:  This i sc e r t a i n l y  i n Canada.  i n Canada  transportation  t h e case of  The h i s t o r y  i s consistently  b e f o r e 1900;  of  divided  t h e second  -  railroad  into  from  three  1900 t o  f r o m 1923 t o 1 9 3 1 .  Railwav Construction (Miles o f Track)  Manitoba  Saskatchewan  Alberta  Total  1906  2,774  1,957  1,235  5,966  1910  3,221  2,932  1,488  7, 641  1915  4,498  5,327  3, 174  12,999  1920  4,404  6,220  4,474  15,098  1925  4,539  7,056  4,965  16,560  1930  4,410  8,175  5,607  18,192  1935  4,970  8,555  5,760  19,285  1970  4,745  8,565  6,244  19,555  1980  '•-  -  -  18,250  1985  —  —  —  17,000  Source:  State of The Industry Report Canada Grains Council. 1974  - 97 -  Prior railways land  to into  and  25  were  million a  Montreal  no  use  another  Canada  introduced.  acres  and  to  anybody of  and  permitted "belts"  settlement."  of to  2 7  the Canadian  constructed immediate world  a  choose  In  15 m i l l i o n  fertile  land  i n rugged benefits  since  to  in  areas this  railway this  a period  period  land  Policy  of  was  (which a  free  of the  ( p r i m a r i l y t h e CPR) sections  in  as, " f a i r l y f i t f o r land  almost  province 2 8  expansionary  grants  50 p e r c e n t  companies  elsewhere.  preferred  for  mileage  There  were  policy  as  no the  depression.  b e t w e e n 1900 and t h e 1914-18 W o r l d War was  of unusual p r o s p e r i t y .  w h e a t boom  free  settlement  railway acres  railway  system  odd-numbered  designated  was  Therefore,  introduction  Saskatchewan  total,  and  survey  railways  from  or "blocks"  federal  for building  National  the rapid  of  Railway  purpose.  was u n d e r t h e i n f l u e n c e o f a g r e a t  The  first  to  approximately  choose  Railways  the  The p a r t i c i p a t i n g  by  "trans-continental"  without  prairies.  totalled  Pacific  the so-called  Metis)  extension  encouraged  A combination of a r a p i d the  and  i n return  Vancouver.  policy facilitated  railway  land  mile  homestead  were  was  Canadian  of  3,000  component  alienated  construction  F o r example,  maintaining  between  the  western  grants.  granted  1900  i n Canada  I t was t h e p e r i o d  of the  and a p e r i o d o f i n t e n s e  railway  - 98 -  r  building 1900  and r i v a l r y .  In the fifteen  year  period  t o 1915, Canadian R a i l w a y m i l e a g e d o u b l e d ,  from  17,657  Table 2:  t o 34,882  Railway  total  was  this  time  miles  Construction  located  of l i n e .  40 p e r c e n t  i n the prairies.  period  that  two  increasing  As i n d i c a t e d i n  2 9  approximately  I t was  more  from  of the  also  during  "trans-continental"  r a i l w a y s were completed.  The  f e d e r a l government promoted e x p a n s i o n o f t h e main  east-west CPR.  railway  There  provinces offer that  there a  miles  of  t o provide  strong  pressure  of Alberta  lower  alone  was  network  rates  from  t o move  traffic  east-west  operational  grain.  of  Grand  2,902  Trunk  miles  system.  railway  $200 m i l l i o n  which  consisted  withstanding dollars  Pacific,  between  also  t h e newly  of a  the praise  i n debt i n 1 9 1 6 .  of  i s no  formed  of  1915, w i t h Canada  country  - 99 -  35,000  had  more  i n the world.  3 0  of a system  and P r i n c e  Rupert,  was  The C a n a d i a n N o r t h e r n , 9,300  Skelton,  3 1  evidence  a second y e t  which consisted  i n debt.  system  By  track,  Montreal  dollars  There  t o warrant  t r a c k a g e p e r c a p i t a t h a n any o t h e r  The  with the  and S a s k a t c h e w a n f o r new r a i l r o a d s t o  was s u f f i c i e n t third  competition  miles was  and, not-  $427  million  The and  combination  homestead  increasing 100,000  policy  i n 1916. period  this  The from  period  boom,  resulted  i n Saskatchewan  same t i m e during  o f wheat  in  the f i r s t  government the  CPR  would  be no c o n s t r u c t i o n between  border  for  Manitoba  took  level.  to American  made  utilized  successful  Pacific)  Canadian  Northern.  Canadian Northern and,  rates  this  I t was  also  the  completion  i n return,  approximately  of  there  by any  other States  government  of  t h e CPR h a d a m o n o p o l y o n rates  attempts  a  at too high  to issue  on  into  an  guaranteed a line  Canadian .04^ a  - 100 -  from  i n the  eventually  small . railway agreement  with  the  bonds  of  Port  Arthur  to  Northern  bushel  Charters  power  a  a  t o t h e CPR  Manitoba  lease  and i t e n t e r e d  to construct  A  federal  the United The  the Charters.  Manitoba  developed  (1884-85)  h i s dis-allowance  i n obtaining  (Northern  grain  and  freight  several  during  railroads to e s t a b l i s h competition  MacDonald  Winnipeg  following  period.  the p o s i t i o n that  Constitution to overturn was  1881, between  mainline  and e s t a b l i s h e d  farms  i n 1901 t o  major c o n f l i c t  the prairies  twenty-year  Manitoba  3 2  o f any b r a n c h l i n e s  t h e CPR  a  prairies  but  of  through  increased  of  p r o v i n c i a l governments.  and t h e CPR, was t h a t mainline  railway  the  t h e Agreement  13,500  to 650,000.  b e t w e e n t h e f e d e r a l and p r a i r i e clause  from  population  that  construction  i n t h e number  alone  100,000  railway  established  below  t h e Crow  Rates.  Canadian  Pacific  immediately  r a t e s , t o meet t h e c o m p e t i t i o n rates  competition.  successful.  The once  the  period  by keen  formation  through  (CNR).  1928.  of  a more  1970s.  As  branchline  a  i t faced  Manitoba  was  was  1931 was  aided  marked  somewhat i n  opponent  t o t h e CPR  o f t h e G r a n d T r u n k P a c i f i c and the Canadian a  billion  lucrative bushels  National  Railway  traffic,  yields  were  produced  in  was n o t s u r p a s s e d  again  u n t i l the  indicated  i n Table  over  2,000  miles  of  total)  were  built  in  (2/3 o f  Producers this  railways  believed that  t h e reach  to build  2,  the nation's  during  rivalry  its  large crop  elevator  Rivalry  of  1923 and  formidable  was c o n s i d e r e d  Saskatchewan.  was  policy  This  into  and o v e r  This  beyond  between  rivalry.  Northern  Grain  high  and l o w e r e d  and A l b e r t a w h e r e  railway  the nationalization  Canadian  were  The  i t s grain  3 3  third  again  the  i n Manitoba  by .02^ i n Saskatchewan  less  lowered  delivered  time  p e r i o d by horse  hauls  of grain  i n excess  producers  up t o t h e t e n - m i l e  provides  a classic  grain  example  became.  - 101 -  to the  country  and wagon.  The  of ten miles  were  thus  limit. o f how  railway Figure 3:  policy Branchline  aggressive  this  FIGURE 3:  Branchline (1930)  Rivalry  CPR  CP  Rail  constructed  believed  this  construct  a  would  In of  off  between  Subdivision an  attempt  the  two  becoming i r r a t i o n a l  1931  "National that  t h e t i m e was  r i p e f o r an  p o l i c y i n Canada. Policy"  has  i n actual  because i t by  CNR  existing  to  lines.  and c o s t l y .  o f t h e R o y a l C o m m i s s i o n on R a i l w a y s  railway  argued  Wishart  head  subdivision  R a i l w a y r i v a l r y was  Report  the  1931-1932  overall  examination  The m y t h o l o g y o f M a c D o n a l d ' s  already  been  discussed.  It  f a c t t h e p r o g r a m s and p o l i c i e s  - 102 -  was which  have  historically ad  actually  particularly Michael  for  attributed  hoc,  parochial  true  f o r railway  Bliss,  policies  been  "Ottawa's  were  and  costly.  of a coherent  volumes and  remained  other  building  constant,  railway took  advocated  traffic  i t s  significantly  Such  under  the Ontario  restore  the financial  and t h e d e p r e s s i o n .  final  report  Court  (1933), tighter  which  Royal  health  Railway  The D u f f  hearings  Commission was  in  spent  Canada  Justice  who  controls.  accepted  The  - 103 -  were  n i n e months  a l l o f t h e Duff  by t h e government  railway Duff  a  headed by  i n t h e Canadian National - Canadian Pacific Railway  fiscal  to  and d e l i v e r e d  Virtually  i n more  fact  and t r u c k c o m p e t i t i o n  t o t h e new C o n s e r v a t i v e G o v e r n m e n t  resulted  on  recommendations  Commission  across  were  Presidents  of the railways  of lines,  grain  and CNR  Railway  t o make  recommendations were  and e m b o d i e d  rapidly.  Commission  R i g h t H o n o u r a b l e R. B. B e n n e t t . Commission  Canadian  t h e R i g h t H o n o u r a b l e Lyman D u f f ,  Supreme  public  a  or recipe  significantly  t h e CPR  both  of  a  a f f e c t e d by o v e r - e x p a n s i o n  holding  such,  the establishment  established  declined  and b o t h  As  plan  and a l t h o u g h  had f a l l e n  toll  i n debt.  "Transportation".  of  prices  to  development  the overall  economy was i n d e c l i n e i n t h e t h i r t i e s  was  According  national  Admittedly,  3 4  were  This  policy.  several  not part  nation-building."  to National Policy  regulation Commission  Act and was  particularly  harsh  construction  policy  not  only  part  deferred  and l e v i e d  of  i t s branchline  strategic  federal  program  that  policy  criticized in  and  might  railway  have  would  ( s e e Figure the railways  branchline  against  provincial  o f each  i t sr i v a l  to i t slines  t h e Commission  i n branchline  criticism  I n response t o t h e c l a i m  3 5  unrestrained  rivalry  strong  but also  but f o r the fear  territory Rivalry),  the intense  the railways  governments. that  on  3:  been invade  Branchline f o r their  construction.  It  concluded:  " . . . i t i s c l e a r t h a t t h e r e was i n t e n s e rivalry between t h e two s y s t e m s i n new territory, p a r t i c u l a r l y i n the provinces o f Saskatchewan and A l b e r t a . The c o n s t r u c t i o n p r o g r a m o f o n e company was r e s p o n d e d t o b y an e q u a l o r g r e a t e r program of construction by t h e o t h e r . The development of this territory d i d n o t meet expectations and the railways now find t h e m s e l v e s w i t h a d d i t i o n a l t r a f f i c m i l e a g e and an i n c r e a s e d b u r d e n o f c a p i t a l c h a r g e . " 3 6  The D u f f C o m m i s s i o n , w h i l e and u n c o n t r o l l e d not  provide  review been  a  between  any recommendations  large branchline railways  competition  critical  would  t h e two r a i l w a y s , d i d  to deal  with  the overly  network nor t h e impending c o m p e t i t i o n t h e soon  o f Table 2: slight  of the aggressive  face  Railway  increase  from highway Construction i n the size  - 104 -  transportation.  shows  that  there  of the r a i l  A has  network  in  since the Duff  the prairies  report.  I t was  over-built gathering  in  not the  the  only 1930s  System M i l e a g e of Elevators  No.of D e l i v e r y P t s . M i l e s o f Road Source:  The  entire  grain  Trends  (1930 t o 1985)  1960  1970  1980  1985  18,192  19,238  19,238  18,200  17,000  5,700  5,300  4,970  3,133  1,952  2,500  N/A  1,835  1,394  1,148  Department of Transport, "The Crow Book", Ottawa, 1982.  major  conclusion  (farm  that  as  c a n be d r a w n  Trends i s t h a t  of railways  untouched  Saskatchewan, component  the  was  20,000 160,000 200,000 200,000 200,000  t h e system  virtually  also  that  1930  Grain Handling and Transportation 1970  but  system  G r a i n H a n d l i n g and T r a n s p o r t a t i o n (Prairies)  No.  railway  submitted i t s  system.  T a b l e 3:  Rail  Commission  and g r a i n  by e v e n t s  taking  i n Alberta  and n o n - f a r m  and  1930 and  elevators  remained  around  Manitoba,  than  1,000 p e r s o n s )  of the population  cent  i n 1 9 0 1 t o l e s s t h a n 20 p e r c e n t  - 105 -  between  place  residents  Table 3:  from  i t .  the  i n centres  In  rural  of less  s h i f t e d f r o m 85 p e r i n 1970.  Prior to  1949,  less  were farm  than  supplied  one p e r c e n t  with  electricity.  i n the province  Changes evolved  in Agricultural  o f Saskatchewan  has access  Society  i ntheprairies  list  Today  producers  virtually  to electricity. the various  every Table 3:  trends  that  s i n c e t h e 1930s.  T a b l e 4 : Changes i n A g r i c u l t u r a l  Society  1.  Despite t h e presence of r a i l s e r v i c e , most grain d e l i v e r y points experienced s i g n i f i c a n t decreases i n population.  2.  D u r i n g two d e c a d e s ( 1 9 6 0 t o 1 9 8 0 ) c o n s o l i d a t i o n o f all public services (particularly school and h o s p i t a l ) c o n t i n u e d as p a r t o f p r a i r i e provincial government's s o c i a l p o l i c i e s .  3.  I n t h e l a t e f i f t i e s t h e r e w e r e o v e r 1,000 i m p l e m e n t d e a l e r s on t h e p r a i r i e s . T o d a y t h a t number i s l e s s than 400.  4.  I n 1930 t h e r e w e r e a p p r o x i m a t e l y 300,000 p r o d u c e r s o n the prairies. T o d a y t h e number h a s d e c r e a s e d t o 140,000.  5.  Consolidation of grain on m a i n l i n e and secondary lines has r e s u l t e d i n 1/5 o f t h e g r a i n delivery p o i n t s h a n d l i n g 1/2 o f a l l t h e g r a i n . M o r e o v e r , 30 p e r c e n t o f t h e p r o d u c e r s a c c o u n t f o r 80 p e r c e n t o f t o t a l p r o d u c t i o n . T h e y own 60 p e r c e n t o f t h e f a r m machinery.  Source:  Prairie Rail Action Committee Report (1979)  - 106 -  The  significance  federal to  and p r a i r i e  appreciate  various 1930.  branchline haulage  c a n one  existence  prior  frozen  and  place  that  between  1930 when h o r s e  trucks  t h e Duff  a n d 1970 when significantly  o f p r o d u c e r s t o move f o r this  since  the prairie  i n u s e a n d when  larger  failed  them i n t h e  took  the fact  was  grain.  There  and a l l o f them a r e  rail  possible  responsible  to that  rates.  and  national the  (regardless  of the prairie  and t h e f e d e r a l  transportation was  o f need)  provinces. government  Transportation  emphasis  At the forefront  on  at the  of this  debate  The t a r g e t was which  was  held  f o r railway policy.  Second, t h e p e r c e p t i o n lifelines  year,  policy service  transportation policy i n  o f t h e National  t o the passing  railway  of  railways  was no n a t i o n a l  Prior  were governments the  roads  there  retention lowest  which  was s t i l l  explanations  i n 1967.  policy  either  both  to this thesis.  First,  Act  debates  remained  the a b i l i t y  several  relevant  i s that  s t a t e d t h e n e t w o r k was t o o l a r g e ,  improved  increased  and 4  o r chose t o ignore  explain  to elevators  Commission  are  these trends  network  3  provincial politicians  transportation How  vastly  of Tables  t o t h e many  small  existed  that  communities  - 107 -  railways  were t h e  on t h e p r a i r i e s ,  which the  would  "die"  Commission  headed  by  i f the  on  former  r a i l w a y s were removed.  Grain  Handling  Supreme  Court  Saskatchewan, t a b l e d a report considerably  technical  sensitive  section  on  the  Commission  recognized  those  and  the  who  appeared  reality  of  grain  Hall  which,  details,  prairie  the  Emmett  i n Parliament  in  did  today.  of  Amongst  a  producer.  number  ,  from  include  retaining  3 7  although  d i f f e r e n c e between the  i n support  1976,  Transportation  Justice  weak  of  and  In  a  That  sincerity branchlines  of  things  i t  said:  " I t a p p e a r s t h a t t h e r e may be a tendency to e q u a t e ' t h e s i g n i f i c a n c e o f t h e r a i l w a y o f 30 t o 50 y e a r s w i t h i t s s i g n i f i c a n c e t o d a y . " (Vol. I, p. 7 6 ) . " I t i s t h e p e o p l e and t h e s p i r i t o f t h e p e o p l e w h i c h g i v e s the community v i a b i l i t y , not the r a i l w a y s , n o t t h e e l e v a t o r s . " ( V o l . I , p. 7 9 ) . The C o m m i s s i o n was u n a b l e t o l o c a t e any study which indicated that the viability of a c o m m u n i t y w h i c h was a l r e a d y d e c l i n i n g w o u l d be s a v e d by r e t e n t i o n o f t h e r a i l w a y . " (Vol. I, p. 8 3 ) .  The distrust between has  third of  explanation  the  producers  i t s roots  is  railways." and  embedded  the  3 8  "...the This  railways  deeply  - 108  in  -  traditional  tradition  of  (particularly history.  In  prairie antipathy the  the  CPR) early  development p e r i o d farm  sector  power  as  by t h e i r sole  Consequently  performance Land  grants*  between  or  service f o r  based Rarely  supplies freight  wealth derived  and  eastern given  based to the  construction  universal  land  grants  by. t h e r a i l w a y s  rates.  came t o be  3 9  the p r a i r i e branchline  Ottawa  producers.^  The f o r t u i t o u s b u t u n f o r e s e e n  from  investments  lobbying  of grain  railways'  under t h e  statutory grain  reduce  the  by t h e railways  regarded as l e g a l i z e d r o b b e r y .  with  to  r i s k element i n western r a i l w a y s '  agreements.  Fourth,  and q u a l i t y o f  consideration  to the obligations f u l f i l l e d  early  rates  as p r e f e r e n t i a l arrangements  politicians was  of a l l descriptions.  attention  t o thousands  came t o be s e e n  entrepreneurs. high  of transportation  unfavourable  eastern  initial  monopolistic  over  as l a n d l o r d s  antagonized the  use of t h e i r  and i n b o u n d  conflicts  drew  frequently  unbridled  providers  outbound product  service  the railways  s y s t e m became e n t a n g l e d  The R a i l w a y s '  i n the prairie  r e a c t i o n was t o  branchline  f o r an e n d t o l e g i s l a t e d  system  freight  while  rates.  4 0  ^Western lands did pay for the building of the CPR and the federal government did retain control of these lands until 1930 but the federal transfer payments to the provinces were sufficient to cover the original "cost" of the land. As well, the CPR sold off over 90 per cent of its lands by 1920 to grain producers at about $1.00/acre. Today that land is worth between $300-$500.00/acre.  - 109 -  The  MacPherson  detail  i n the section inter alia  recommended and  i n 1961 ( w h i c h  a subsidy  government  decisions federal  related  f o r uneconomic  issued  b u t 1839 m i l e s  its first  branchlines.  branchlines  o f many ad hoc In  1965 t h e  an O r d e r - i n - C o u n c i l *  of branchline  Act (1967)  lines.  responded w i t h to prairie  government  i s discussed i n  o n t h e National Transportation  t h e abandonment o f u n n e c e s s a r y  The  all  Commission  from  protecting  abandonment f o r t e n  years.  During continued  this to  government  period  remain  appointed  Commission on G r a i n grips  with  industry,  the  However  Justice Hall,  the  Transport network  2000.  virtually Justice  Handling  the branchline unchanged.  Emmett H a l l  fundamental  problems  prior  to  federal  t o head  up  a  t o come t o  confronting  with  assigning  network  The  and T r a n s p o r t a t i o n  including a strategy to deal  network.  of  of time  the  the branchline  the  network  to  t h e f e d e r a l government on t h e recommendation M i n i s t e r Otto from  Lang, p r o t e c t e d  abandonment  until  12,413 m i l e s o f  at the least  I n a d d i t i o n , 525 m i l e s w e r e a s s i g n e d  t h e year  t o t h e Canadian  *Officially known as Governor-General in Council Order but it is actually a Cabinet Order which can commit the public purse to financial obligations. It is not discussed or approved by Parliament.  - 110 -  Transport Hall  Commission  Commission  remaining  was  (CTC) f o r abandonment asked  t o make  hearings.  recommendations  The  on t h e  6,283 m i l e s , a b o u t 30 p e r c e n t o f t h e n e t w o r k .  T a b l e 5:  1975 - B a s i c  Status of Railway Mileage  12,414.0  Network  (1975-1979)  Cabinet Order public hearings  no  1977 - H a l l C o m m i s s i o n  -  1,812.6  Royal public  1978 - P r a i r i e R a i l A c t i o n Committee  -  1,000.6  Technical Committee headed by P r o f e s s o r Fred Anderson, U n i v e r s i t y of Regina - no p u b l i c h e a r i n g s  1979 - N e i l R e p o r t  658.9  15,890.1  The  Hall  Commission  added t o t h e b a s i c (the one  government to  assign  recommended  Technical Committee h e a d e d b y Doug N e i l , M.P. f o r Moose Jaw - no p u b l i c h e a r i n g s  that  network f o r p r o t e c t i o n  accepted 2,165  this  miles  Commission hearings  1812.6 from  m i l e s be  abandonment  recommendation as i t d i d t h e to  hearings).  - I l l-  t h e CTC  for  abandonment  The  Hall  C o m m i s s i o n was u n d e c i d e d  it  recommended  Mr.  Lang  that  rejected  these  this  be  protected  particular  advice  o f t h e e l e v a t o r companies  invest  i n their  facilities  o n 2,344 m i l e s and f o r 12  recommendation who s a i d  on l i n e s  they  left  years. on t h e  could not  i n a stage  of  limbo.  In  1977 t h e 2,334 m i l e s w e r e a s s i g n e d  R a i l A c t i o n Committee Regina a  and  1,000.6 m i l e s  abandonment  federal 1,000  mileage  were  review  had  recommended  659  miles  mileage  to the basic  which  recommendations  t h e mileage  brought  Moose  the  impact  hearings.  Progressive  on t h e b r a n c h -  t o producers  Jaw M.P.  (about  f o r abandonment.  and t h e  abandonment a n d t h e o t h e r  i n response  appointed  network  Once a g a i n t h e  t o t h e CTC f o r abandonment  The P C ' s ,  CTC r e v i e w ,  once a g a i n  these from  PRAC recommended  mileage.  i n t o power h a d a d i r e c t  network.  under  protected  election  Conservatives line  accepted  was a s s i g n e d  1979  t o be added  of t h e remaining  government  miles  The  (PRAC)*, headed by t h e U n i v e r s i t y o f  Economics P r o f e s s o r Fred Anderson.  further  to the Prairie  Doug  on l i n e s Neil  to  1500 m i l e s ) t h a t PRAC  Neil  recommended  about  be a d d e d t o t h e b a s i c n e t w o r k a n d t h e r e m a i n i n g  b e a s s i g n e d t o t h e CTC f o r f u r t h e r  review.  "The Committee consisted of Professor Fred Anderson and three grain producers: Jack Gorr (Alberta), Bill Cooper (Sash), and Jack Parker (Man). All were appointed by Lang.  - 112 -  There be  a number o f  are  the lengthy process  drawn from  The date of  total  mileage  miles  of  about  1/2  by  of  per  the  Hearing  was  she  of  approved  m i l e a g e was  rail  above.  line  2,400 m i l e s 1930.  by  the  CTC  abandoned  or  Of  actually  by  m i l e a g e of  abandoned  12  the  Hall  before  an  be  at  abandoned  least  without  to  come  the  the  "regional"  met.  The  "cloud  cent 2,000  previously  unduly  year  who  have  may  i s one  of  by  were the  PRAC, Doug was  and  provincial the  of  national  doom"  had  community  Neil  issued.  those  and an  reported  provincial/local adverse  debate.  - 113  -  were  affect  on  to media the  No  a  CTC felt  branchline subject  of  (M.P.)  and  The  issue  issues which  interests  p o s i t i o n s were  2000. of  affected  abandonment o r d e r  approximately  benefit  forward  Commission,  abandonment  that  both  to  abandonment,  e x p l o i t e d by p r o v i n c i a l g o v e r n m e n t s t o c r e a t e t h e  by  per  first  for  16,700 m i l e s ,  I n some c a s e s b r a n c h l i n e s  the  branchline  anyone  would  abandonment.  CTC  of  in  are p r o t e c t e d u n t i l  allowing  or  the  existence  remaining  cent  review  miles  can  producers.  branchline  he  in  the  of  conclusions that  discussed  approximately  branchline  grain  Of 83  number  (1984-85) are  the  interesting  was  impression not  being  the  nation  and  this  Crow  Rate  If should  the be  extensive  federal for  developing  basic  network  network  fulfils  only  grain  and  funnels  port.  As  already  grain the  grain  program  in  been  spent.  basic  year  As  2000.  the  of  To  these  further  began  a  of  1985-86,  it  guaranteed  an  i t  branchline  collects  the  f o r d e l i v e r y to 1/5  for  of  50  compound  a l l the  per  delivery  major  i s expected  criticized,  The  mainlines  responsible  16,000 m i l e s  network  s y s t e m was  efficiency.  which  role:  cent  points  this  to cost  over  of are  problem,  branchline  $730 m i l l i o n  and  of  rail  almost  1/3  e x p e n s i v e r e p a i r , some o b s e r v e r s i n the  be  repair  $1  billion  had  already  4 1  With over the  the  to  Many  which  when c o m p l e t e d .  to  policy  basic  are  government 1977  is  i n d i c a t e d , approximately  mainlines.  federal  to  i t on  volume.  on  a  one  delivery points  located the  government  One  not  line of  still i t  included  eligible  b e l i e v e that the  d r a s t i c enough t o  of these observers  allow  i s Fred  for  - 114  -  for  reduction improved  Anderson  ...claims p o l i t i c a l pressures made t h e e n t i r e rationalization process less than adequate. The basic network is itself an irrational c o l l e c t i o n of l i n e s d e r i v e d from a s e r i e s of politically expedient decisions. Events show t h e r e i s s t i l l t o o much m i l e a g e i n t h e basic network. 4 2  in  who:  If it  Table 5: Status of Railway Mileage (1975-1979)  one e x a m i n e s  i s quite  protected  evident  from  the largest  abandonment  miles.  What  lines?  There  federal  department  "...there  that  was  i s the i n i t i a l  the basis  i s no  f o r the  public  of  segment  report  transport  was no s o p h i s t i c a t e d  block  to refer  official  basis  transport  Director  possibility  companies 1985.  imminent was  would 4 4  style will  t o and one that,  He g o e s o n t o  railway  is  far  o f PRAC was q u o t e d ,  existed abandon  that a  grain  fully  from  ignored.  one made o n and  federal  over.  producers/handling branchline about t h e  transportation,  one o f t h e r e a l  was  The  back i n 1978, t h a t  Commission warned  Thus  examined  from  rehabilitated  highway  of federalism be  these  4 3  I n 1932, t h e D u f f  apparently  this  between  of  conceded  s t u d y done."  debacle  competition  Canada's and  meeting  branchline  Executive  by  a  officials.  The  a  of  mileage  o f 12,444  support  s u g g e s t t h a t t h e d e c i s i o n was an i n s t i t u t i o n a l the  of  beginning  costs  t o take  i n the following  which of  shape  section  on  highway t r a n s p o r t a t i o n .  3.1.4  Highway  The  Transportation  j u r i s d i c t i o n over road t r a n s p o r t a t i o n  - 115 -  undertakings  is  split  local,  depending  inter-provincial  necessary and  on whether  or international  to distinguish  j u r i s d i c t i o n over  the undertaking  between  i s of a  nature.  jurisdiction  I ti s  over  roads  t h e motor c a r r i e r i n d u s t r y .  R o a d s a r e n o t m e n t i o n e d i n e i t h e r S e c t i o n s 91 or 92 o f t h e Constitution Act 1867, t h e judges referred to the terms "connecting" and "undertaking" t o j u s t i f y t h e i r decisions. In the words o f L o r d P o r t e r * : "The p r o v i n c e h a s i n d e e d a u t h o r i t y o v e r i t s own r o a d s , b u t o n l y t h a t a u t h o r i t y i s a l i m i t e d one and d o e s n o t e n t i t l e i t t o i n t e r f e r e w i t h connecting undertakings. I t must be remembered t h a t i t i s t h e undertaking ( t h e a c t u a l movement o f g o o d s a n d p a s s e n g e r s ) - n o t t h e r o a d s , w h i c h comes w i t h i n the Dominion..." 4 5  The court  federal  cases  was  (international provincial vehicle Vehicle  to  and  to this  delegate inter-)  ruling  provincial  transportation legislation Transport  Act arose  Transportation  in again Act.  and a number o f  the regulation  boards e s t a b l i s h e d pursuant  jurisdiction National  response  1954 . 4 6  The  *Lord Porter was a member of the British Canada's Supreme Court until 19491  extra  undertakings  to provincial  matter  motor  of  federal  t h e passage  I I I of  that  to  t h e Motor  by e n a c t i n g  i n 1967 w i t h Part  of  Act  of the would  Privy Council, which acted as  restore  federal  trucking  but  can  explained  be  interested resisted  that  section by  and  has  government  complete  support  a  buses,  single  jurisdiction  governments w i t h Deputy M i n i s t e r  the  over  not  extra-provincial  invoked.  federal because  Partially  government the  not  being  provinces  have  no  been  to  allocate  jurisdiction  over  regulatory  agency.  is overall  to  the  railways In  federal with  the  trucking  and  shared  by  ten  national  standards.  provincial  of T r a n s p o r t , John B a l d w i n , argues  A  former that:  "...under ten s e p a r a t e j u r i s d i c t i o n s , growth of n a t i o n a l c o v e r a g e has b e e n s l o w and fragmented and t h a t t h e m o t o r c o a c h s e r v i c e has a less c o m p l e t e and less equitable arrangement than c a n be f o u n d i n a i r and r a i l p a s s e n g e r f i e l d s . Because the c o u n t r y l a c k s n a t i o n a l regulations and a f e d e r a l r e g u l a t o r y a g e n c y , n o t o n l y d o e s Canada as a whole lose the advantage of a national motor carrier industry but various regions, s u c h as A t l a n t i c C a n a d a , s u f f e r in particular." 4 7  As  this  notion.  result  of  was  partially  such a  The  jurisdiction  Baldwin further  points  out:  "...regional transportation companies tend to charge higher rates in response to higher regional costs. The r e s u l t i n g i n e q u i t y may be o f f s e t p a r t l y by t h e a d d i t i o n a l p r o v i s i o n s of national service and federal regulations. However, w h i l e t h e s e e q u a l i z i n g f e a t u r e s exist with respect to a i r t r a n s p o r t a t i o n , they are lacking in regards to the motor carrier industry." 4 8  - 117  -  As  in  the  provincial the  major  this  growth  industry. the  late  1930s.  1938  to  of  the  vehicles  in  1958.  and  350,000  operating  expenses.  railways'  share  truckings'  of  1966  share  of  private)  has  terms  domestic  of  risen  a l l such  provincially  The provincial  5 0  On  the  basis  of  to  per  in  freight 44  movement  per  inter-city trips  significance governments system  are  cent  and  passenger  firms  billion  fallen  from  1983;  per  or  in the 55  for-hire but  not  cent.  In  traffic,  auto  one  revenue,  30  in  trailers,  (commercial  from  made by  road  of  cent  over  60,000  $15  has  to  National Transportation Act  paid  220,000 to  some  movements  37  carrier  correlates  from  tractors  and  on  beginning i n the  freight  regulated  transportation  people  motor  again  1982,  trucks,  centred  industry  industry  In  services,  transportation  the  doubled  4 9  500,000 c o m m e r c i a l  in  trucking  is  of  r e g i s t r a t i o n doubled 1948  cent  health  case  concomitantly  in  over  the  i n the r a i l w a y  Truck  and  transportation In  488,000  employed  of  in  and  growth  decline  operated  cent  education  sectors.  roads  , The  with  per  of  jurisdiction  means  million  case  bus  93.3  per  over  the  the  ten  in  the  in  the  system.  this  play which  trend  a  significant  was  (1967).  - 118  is  -  not  that role  recognized  Road B u i l d i n g  As road not  already  indicated, the extent  and magnitude o f t h e  b u i l d i n g p o l i c y o f t h e t e n p r o v i n c i a l governments has received  railway Darling  as h i g h  freight  a profile  rates  identified,  by  as have  i n Canada:  t h e debates  However,  as  over  Howard  1950:  . . . t h e onward s u r g e o f c o m p e t i t i o n from highway c a r r i e r s was n o t o n l y c o n t i n u i n g t o d e s t r o y t h e r a i l w a y r a t e s t r u c t u r e , o v e r w h i c h s o much p a s t d i s p u t a t i o n had o c c u r r e d , b u t was s e l e c t i v e l y penetrating railway traffic, stripping the general traffic from branchlines and short hauls of a l l k i n d s . 5 1  In  1959, t h e D i e f e n b a k e r  MacPherson resolve  Commission  the continuing  additional  Anderson  criticized  rate  Director  of  primarily  to  the railways* f o r  increases.*  of that  of the University  t h e narrowness  established the  Transportation,  pressure  "horizontal"  Secretary/Research Fred  on  Government  The  Commission,  of Regina,  former  Professor  subsequently  o f t h e Commission's  terms o f  *The railways' use of horizontal increases, the application of a uniform per centage increase to all commodities to meet their cost increases was perceived by some provinces to be inequitable. The railways' argued that they seldom applied such increases.  - 119 -  reference,  "...as  railways,  being  specific  r e a f f i r m i n g as  late  in  as  their  1959  the  attention  to  p e r s i s t e n t myth  that transportation i s railway transportation i n Canada."  Notwithstanding system the  was  initiated  proposed  only  were  dirt.  gravel  ten  (1919).  miles By  5 3  road  but  this  reason  rail  for distances  1939-1945  World  roads  and  a l l the  by  high  billion of  miles. such,  5 5  miles not  road  system  Between  1946  and  increased  in  centres  which  Paved  roads was  100  of  from In by  the  the  as  1922;  with per  program  4,000  paved a  miles  of For  competitor  to  Following  the  the  grew  length  total  1950  there  spending  doubled were  linked  to  25,000  increased  to  considered  on $1.8  miles 75,000  t r u c k i n g s e r v i c e s and,  -  of  10,000 t o 57,000 m i l e s  nearly  - 120  roads  i n Saskatchewan  1960  mean f a s t  there  highways.  miles.  1966  had  the  capita  remaining  over  Canada  1970  now  a  highway  i n Saskatchewan were  In  5 4  1970.  road  to  from under  roads.  comply  considered  the  War  trucking  of  50  highways  a year  paved  100  were  a  early  provided  start  there  provincial  and  the  to  beyond  quality  streets  Act  1959,  as  g r a v e l roads;  t r u c k i n g was  significantly. surfaced  At  1940 only  planned  This  of  in  Saskatchewan  being  to each p r o v i n c e .  were  perception  in  network  Canada Highway Act, grant  that  5 2  competitive  as to  rail  f o r d i s t a n c e s i n t h e 400  To  service  settlements dispersed has  and  more  addition,  As  a  villages  mileage,  50  on  Moreover, per  mileage  cent  in  Canada.  capita  three  total.  distance  of  of  As  of  a  Saskatchewan at  road  least  of  the  railway  than  any  provinces  alone over 90  one  ten  other  contain  and  25  In and  rural)  consists  per  i s within  one  widely  Quebec.  (highway  road,  result  of  basis,  a  historically  more  Saskatchewan  the  population  by  prairie  total  125,000 m i l e s  Saskatchewan, in  province  per  approximately nation's  the  served  the  of  Saskatchewan  is  the  of  area  established  result than  a  range.  growing  were  Saskatchewan  province. over  grain  farms  manner.  had  highway  the  mile  of  per  cent  of  cent  of  the  hour's  major  driving  commercial  centres i n the province.  Thus t h e s e c o n d the  road  provincial the  rail  system  t r a n s p o r t a t i o n system  completely  and  system  to  long-haul  freight  i n i t s 1977  -  in  by  report,  5 6  the  relegating  shipments.  y e a r s o f p u b l i c h e a r i n g s on t h e  - 121  prairies,  operated  governments, e v e n t u a l l y succeeded  H a l l Commission documented n e a r l y two  owned  on t h e  As  the  following  prairies:  i)  "Increased c o s t of labour f o r c e d farmers t o improve production technology through c a p i t a l . This resulted i n s o c i a l r e p e r c u s s i o n s i n r u r a l w e s t e r n Canada, i . e . t h e d e c l i n e i n f a r m p o p u l a t i o n and i n t h e number o f community c e n t r e s of s e r v i c e . " (Page 7 6 ) .  ii)  "Tendency t o equate t h e s i g n i f i c a n c e of t h e r a i l w a y o f t h i r t y t o f o r t y y e a r s ago w i t h i t s s i g n i f i c a n c e today." (Page 7 6 ) .  iii)  " E v e n b u l k f a r m i m p o r t s s u c h as fertilizer, fuel, c h e m i c a l s and e q u i p m e n t a r e i n c r e a s i n g l y h a u l e d f r o m r e g i o n a l d i s t r i b u t i o n p o i n t s by t r u c k . " (Page 7 7 ) .  iv)  "The r a i l w a y s h a v e c e a s e d t o h a v e any g r e a t e f f e c t on the s o c i a l aspects of l i f e i n the s m a l l e r communities i n w e s t e r n Canada." (Page 7 8 ) .  v)  "Rural e l e c t r i f i c a t i o n has no d o u b t had the most significant positive social impact on rural life ...due t o t h e i n a b i l i t y ( s i c ) t o k e e p b r e a d f r e s h and vegetables and fruits for longer periods, these commodities were purchased in greater quantity, f u r t h e r f r o m home l e a d i n g t o t h e c l o s i n g o f local b a k e r i e s and s t o r e s . . . " . ( P a g e 7 9 ) .  vi)  "The C o m m i s s i o n was u n a b l e t o f i n d any s t u d y w h i c h i n d i c a t e d t h a t t h e v i a b i l i t y o f a c o m m u n i t y w h i c h was a l r e a d y d e c l i n i n g w o u l d be s e r v e d by t h e r e t e n t i o n o f t h e r a i l w a y . " (Page 8 3 ) .  vii)  " V a s t l y i m p r o v e d r o a d s s i n c e t h e e a r l y 1950s ...have enabled people to travel further for goods and services." (Page 7 9 ) .  viii)  Towns being bypassed by modern highways, d e v e l o p m e n t o f r e g i o n a l h e a l t h c e n t r e s and h o s t s o t h e r items have c o n t r i b u t e d t o t h e p h a s i n g - o u t many s m a l l e r c e n t r e s w i t h t h e i r own identities social patterns. These changes have o c c u r r e d will continue to occur, with or without railway." (Pages 79-80).  ix)  "The e v o l v e m e n t o f a few c e n t r e s r e n d e r i n g a l a r g e number o f s e r v i c e s has taken place only because several s m a l l e r c e n t r e s have d e c r e a s e d in size or disappeared altogether. T h i s t o o k p l a c e , n o t as a p a r t o f a p l a n n e d d e v e l o p m e n t b u t as a r e s u l t o f many people making individual d e c i s i o n s on where they w i s h e d t o s h o p , do b u s i n e s s and s o c i a l i z e . " ( P a g e 8 0 ) .  - 122  -  the of of and and the  The Crow  s i g n i f i c a n c e of  Rate  debate  Rate w i l l grain  argue t h a t  keeps  change  would  the  y e a r s ) and  3.1.5  i s relevant  changes  in  and,  as  a  However,  a l l provinces  in  place  between  1899  these occurred  and  i n 1898  for  system  of  prairie  the Crow  rate  result,  three  levels established  to  the  of a f i x e d r a i l  the  Rate  f i x e d at  1983  and  (84  1899.  T r a n s p o r t P o l i c y Development The  framework  historically  has  efficiency  and  emphasis  the  on  traditional  the  marine r e l a t e d .  national  centred  rail  lever  major  for  cost  "nation-building" War  down  gradual.  within  to  existence  costs  be  Crow  opponents  the  producer  developments with  since  these f i n d i n g s  of  on  the  transportation theme  effectiveness mode. the  versus  concern  with  equity  and  R a i l w a y d e v e l o p m e n t became  federal  objectives.  activities  of  policy  government  Prior  in  to  the  transportation  to  achieve  1914-18 were  the its  World  rail  not  These e v e n t s were:  1. O v e r b u i l d i n g operations.  and  economic  chaos  in  railway  2.  The e s t a b l i s h m e n t of the f i r s t r e g u l a t o r y Board of Railway Commissioners.  3.  The first major rate problems leading e q u a l i z a t i o n of r a t e s w i t h i n the west.  4.  To t h e f i r s t p r i c e c e i l i n g R a t e s on G r a i n . 5 7  - 123  -  - the  Crow's  agency  Nest  to  Pass  As of  already  t h e road  tended  presented  i n this  t h e s i s , t h e development  s y s t e m and t h e c o m m e r c i a l a i r t r a n s p o r t  to  be  specifically,  ignored  rail  as  freight  the  rail  rates,  mode,  continued  Act  dominance  lists  concerns policy  t h e time  December  after  Transportation  i s remarkable.  which  affected  t h e 1939-45 W o r l d  Some  of  these  major  If  national War,  rail  transport  on t h e f o l l o w i n g pages.  major  t h e Commission  under  interests  modes  Commission's  still  subject  mode  i t s report  of  the  to federal  better  of multimodality,  intermodal  the  economic with  growing  and recommended jurisdiction  the control of a single regulatory of  that  dealt mainly  d i d recognize  competition  appointment,  prevailed  transport  While  of road-rail  transport  themes  the  i n Canada.  railways,  brought  o f t h e Turgeon  1948, t h e view  were  significance  the  dominant  - Turgeon R o v a l Commission on T r a n s p o r t a t i o n  importance  all  policies  a r e paramount.  railways  the  mode  milestones  issues are discussed  At in  of the r a i l  t h e major  transportation  1951  more  i n 1967.  This one  or  its  r o l e up t o a n d b e y o n d t h e p a s s a g e o f t h e National  system  that be  board i n  coordination.  The  federal-provincial jurisdictional  - 124 -  problems  and t h e n o t i o n  o f a need  f o runiform  regulation  o f a l l modes b e g a n e m e r g i n g o v e r t h i r t y y e a r s a g o .  1954  - Motor V e h i c l e Transport A c t  The  first  government  official  that  trucking  IV o f t h e B i l l  Bill  was the  defeated  amendment other  largely  also  in  and  opposed  because the the  Commissioners  to  commercial road  with  the  i n t h e Senate. transport.  The  opposition  truckers.  This  same  unsuccessful  Bill  C-14  1940 w h i c h , was  t h e then  through  intended,  Board  international  of  an  among  Transport  movements  by  carriers.  1954, a  Ontario vs Winner*  license  1937  Bill  federal  to regulate  of strong  t o t h e 1938 Transport Act, t o empower  the  right  t o highway  i n t h e Commons d u r i n g  things,  In  related  provinces  combination introduced  occurred  o f a new T r a n s p o r t a t i o n  Part  from  by  i t had a c o n s t i t u t i o n a l  extra-provincial introduction  indication  protracted  ended  with  legal  action  the decision  Attorney-General that  of  the federal  *ln this case, the Privy Council of Britain was called upon to rule on whether a passenger bus line which ran between points located in the provinces of Nova ScOtia and New Brunswick and in the United States was subject to sole jurisdiction of the federal government or whether New Brunswick could validly legislate with respect to that part of its operation located within the province.  - 125 -  government  not  only  had  p r o v i n c i a l motor t r a n s p o r t British  North  America  provincial  operations  provincial  transport  since transport  The of  place  to  for-hire regime,  agencies 1954  Act  but  on  a  case  trucking.  was  by a d e l e g a t i o n  with  and r e g u l a r  or regulations  This  in  for extra-provincial s e t up  the  a  regulatory  provincial  vehicle  regulatory through the  A c t provides  at their  for  the  d i s c r e t i o n , of a  t e r m s and c o n d i t i o n s  undertaking  basis  b y t h e outcome  o f t h e f e d e r a l power  l i c e n c e t o a person on l i k e  intra-  i n extra-  o f e x t r a - p r o v i n c i a l motor  by a p r o v i n c i a l board,  extra-provincial  staff  than  Motor Vehicle Transport Act.  issuance  engaged  was s u r p r i s e d  responsibility  left  the  "indivisible".  and h a d no  the regulation  extra-  (a) o ft h e  over  continuous  Rather  over  92(10)  also  o f a n y company  government  assume  undertakings  under S e c t i o n  u n d e r t a k i n g s were  federal  t h e Winner  jurisdiction  involved  as i f t h e  was  a  local  undertaking.  The  Motor Vehicle Transport Act  measure. periodic  However, attempts  vi as  i t remains t o change  intended  i n force  as a stop-gap today  t h e modus operandi  y e a r s ago.  - 126 -  despite  s e t up 30  1956 - T r a n s p o r t a t i o n S t u d y f o r t h e R o y a l C o m m i s s i o n o n Canada's Economic P r o s p e c t s  The  1956  Commission  modes  transportation  on  increasing  Canada's  Economic  and t h e g r o w t h field.  c a r and b u s and t h a t market.  a i rtravel  These  observations  o f two c o n t i n u i n g  competition  and  had g i v e n  policy  the  the  airline  the freight the  ground was  report to the  penetrating  signalled  problems  appropriate  Royal  noted and  domain,  private  recognition  carrier  I n the passenger the railways  the  Prospects  within  out that  long-haul  for  i n competition  pointed  rail  report  i m p o r t a n c e o f t h e motor  transport  the  (Gordon Commission)  the  - trucking/  place  of  rail  passenger s e r v i c e s i n t h e n a t i o n a l t r a n s p o r t a t i o n system.  1961 - M a c P h e r s o n C o m m i s s i o n o n T r a n s p o r t a t i o n  The  most  transportation argued,  into  Commission this. the  Transportation through  of  o r t o be more rail  transport  Report.  There  First, basis  noteworthy  Act  are a  rail  Second, oriented  - 127 -  inquiries  as t h i s was  number  Commission  subsequent  i n 1967.  i t s narrow  exact,  problems  t h e MacPherson  f o r the  a l l the  passage  t h e s i s has  t h e MacPherson of reasons f o r Report of  the  t h e Commission terms  into  provided National pushed  of reference  to  present modal the  to  Parliament  perspective;  regulatory  order  that  process  "...bringing While  the  lawyer, for  the  and  could  Director,  Emeritus  of  Anderson  provides  from  time  upon  with  itself  is  the  was  of  Fred  Economics  of  the  the  headed  report  Riel  following  transportation  the  is  of  rail  in  In  the  credited  up  with,  century." a  Regina  r e c e i v e s the  credit  its  by  Secretary  explanation  Professor of  the  to r e g i o n a l i z a t i o n tenure  with  " T h i s much was new i n the r e p o r t . Up to that time the complaints of regional transport inequities seems a m i n o r b u t noisy nuisance. Historically they have been ameliorated by special statutory provisions for regional transport-pricing through the Maritime Freight R a t e s A c t , t h e Crow's N e s t P a s s A g r e e m e n t and "At and East" r a t e s on g r a i n and the p r i n c i p l e of " e q u a l i z a t i o n " a d o p t e d a f t e r 1951. The transport d i s e q u i l i b r i a e v i d e n t through the decade of the fifties seemed, i n 1959, amenable t o another prescription of adjustment, similar to that attempted by the Turgeon Commission r e c o m m e n d a t i o n s o f 1951. At l e a s t the terms of r e f e r e n c e of the MacPherson Commission appear t o bear t h i s out. The f a i l u r e o f t h e s t a t u t o r y and r e g u l a t o r y events of t h a t decade to s a t i s f y the clamour from the A t l a n t i c and prairie regions seemed, i n t h e p e r s p e c t i v e f r o m O t t a w a , t o be  -  and  Professor  Commission:  - 128  of  mode  modes.  University.  his  multi-  removal  currently  policy  perspective  truly  twentieth  Anderson, at  the  other  Commission into  a  recommended  M a c P h e r s o n , t h e p e r s o n who  Research  written  compete  railways  philosophy  relationship  i t  imposed  MacPherson the  first  third,  Commission  M.A.  the  restraints  i t  the  for  the  c a u s e d by r e g u l a t o r y inadequacies alone. There was no p r e s e n t m e n t t h a t i t was more t h a n t h a t ; t h a t t h e c l a m o u r was, i n f a c t , growing evidence of much more f u n d a m e n t a l f a i l u r e s o f national p o l i c y t o come t o g r i p s w i t h t h e b a s i c structure of Canada. Nothing i n the terms of reference led, on the surface, to a conviction that transport p o l i c y was j u s t one p a r t of broader n a t i o n a l p o l i c i e s w h i c h were t a k i n g t h i s nation i n d i r e c t i o n s away f r o m v i g o r o u s e c o n o m i c and social integration". 5 8  The  major  w e r e as  conclusions  r e a c h e d by  the  MacPherson  Commission  follows:  1.  The r e g u l a t i o n o f t r a n s p o r t a t i o n i n C a n a d a s h o u l d be minimized as much as p o s s i b l e c o n s i s t e n t w i t h the p r o t e c t i o n of the p u b l i c i n t e r e s t ; such r e g u l a t i o n as i s r e t a i n e d s h o u l d b e a r i n a r e a s o n a b l y e q u i t a b l e manner on a l l c a r r i e r s .  2.  The r a t i o n a l i z a t i o n o f r a i l w a y p l a n t and operations should be a c t i v e l y encouraged by public policy; where, f o r n a t i o n a l p o l i c y reasons, i t i s c o n s i d e r e d n e c e s s a r y t o r e t a i n r a i l o p e r a t i o n s s u c h as u n p r o f i t able passenger or b r a n c h l i n e s e r v i c e s , the R a i l w a y s ' s h o u l d be e n t i t l e d t o payment f r o m p u b l i c f u n d s t o c o v e r t h e i r d e f i c i t s on s u c h s e r v i c e s .  3.  No p a r t i c u l a r f o r m o f t r a n s p o r t s h o u l d be s i n g l e d o u t as an i n s t r u m e n t o f n a t i o n a l p o l i c y i f any b u r d e n i s i n v o l v e d i n the performance of the function unless s u f f i c i e n t compensation i s provided t o t h a t mode o f t r a n s p o r t to prevent d i s t o r t i o n s i n the competitive t r a n s p o r t a t i o n market.  4.  Assistance to t r a n s p o r t a t i o n , which i s designed to provide assistance to shippers i n s p e c i f i c regions, s h o u l d be r e c o g n i z e d f o r w h a t i t i s and n o t t o be d i s g u i s e d as a s u b s i d y t o t h e t r a n s p o r t a t i o n i n d u s t r y ; when a s s i s t a n c e o f t h i s k i n d i s d i s t r i b u t e d t h r o u g h t h e t r a n s p o r t a t i o n medium, i t s h o u l d be a v a i l a b l e on a nondiscriminatory basis to a l l .  Source:  MacPherson Commission Report, Vol. I,  - 129  -  1961  This  idea  that  transportation  the  p o l i c y should  efficient  transportation  a  departure  sharp  transportation pursuit great was  of  of  already  the  guide  in  the  being  of  as  for a  Six  reappraisal prolonged large  the  duty.  Act  Commission of  economy,  was  view  one  that  instrument  advice  of  and  1961  of  his  Fred  fellow  Anderson, to  development  of  was  seen  selective provider and  the  facilities role  a  ought  government  services  This  the  infrastructure  and  of  the  for  By  henceforth  was  source  and  and of  services  considered  to  (1967)  Parliament,  national  on  the  objectives.  role  national  regulation.  debate, passed part,  an  financing The  later  of  achieving  MacPherson  resources,  Transportation  years  of  an  "competition"  public  ways  transportation  at  passive  a minimum o f  National  in  a  of  serve  policy  Thus  services.  concern  historical  i n f r a s t r u c t u r e and  compensation imposed  of  to  primarily  organization,  largely  operator  require  place.  concept  with  the  national  suggested,  transportation as  from  Canada's major  commissioners that  be  system  s y s t e m was  broad  deal  principal  the  a  transportation national  recommendations  1961.  -  after  130  -  fundamental policy  Transport Act by  the  and based,  MacPherson  The thereof  goals  of the Act are set out c l e a r l y  i n Section 3  as f o l l o w s :  It i s hereby declared that an economic, efficient and a d e q u a t e t r a n s p o r t a t i o n system making t h e best lowest t o t a l c o s t i s e s s e n t i a l to protect the i n t e r e s t s of the users of transportation and t o m a i n t a i n t h e economic w e l l - b e i n g and g r o w t h o f C a n a d a , a n d t h a t t h e s e o b j e c t i v e s a r e most l i k e l y t o be a c h i e v e d when all modes o f t r a n s p o r t are able t o compete under conditions ensuring that having due regard t o n a t i o n a l p o l i c y and t o l e g a l and c o n s t i t u t i o n a l requirements: 1)  r e g u l a t i o n o f a l l modes o f t r a n s p o r t will n o t be o f s u c h a n a t u r e as t o r e s t r i c t t h e a b i l i t y o f a n y mode o f t r a n s p o r t t o c o m p e t e f r e e l y w i t h a n y o t h e r modes o f t r a n s p o r t ;  2)  each mode of transport, so f a r as p r a c t i c a b l e , bears a f a i r p r o p o r t i o n of t h e r e a l c o s t s o f t h e r e s o u r c e s , f a c i l i t i e s and s e r v i c e s p r o v i d e d t h a t mode o f t r a n s p o r t a t p u b l i c expense;  3) e a c h mode of transport, so f a r as practicable, receive compensation f o r the r e s o u r c e s , , f a c i l i t i e s and s e r v i c e s t h a t i t i s r e q u i r e d t o p r o v i d e as an i m p o s e d p u b l i c d u t y ; and 4)  each mode of transport, so f a r as p r a c t i c a b l e , c a r r i e d t r a f f i c t o o r from any p o i n t i n C a n a d a u n d e r t o l l s and c o n d i t i o n s t h a t do n o t c o n s t i t u t e : a)  an u n f a i r a d v a n t a g e i n r e s p e c t t o any such traffic beyond that disadvantage i n h e r e n t i n t h e l o c a t i o n o r volume o f t h e t r a f f i c , the s c a l e of operation connected therewith or the type of t r a f f i c or service involved, or  b)  an undue o b s t a c l e t o t h e i n t e r c h a n g e o f c o m m o d i t i e s between p o i n t s i n Canada o r unreasonable discouragement to that  - 131 -  development of primary or secondary i n d u s t r i e s or t o export trade i n o r from any r e g i o n o f C a n a d a , o r t o t h e movement of commodities through Canadian p o r t s .  The  A c t made  regulation It  each  resources, public  Nearly  was  fair  20 y e a r s  of the costs  provided  later,  competition.  through the p r o v i s i o n  proportion  and s e r v i c e s  of  consistent  of  as an i m p o s e d  i t m i g h t be n o t e d , a  gap r e m a i n s b e t w e e n t h e p r o v i s i o n s o f t h e A c t  generally  following  the  recommendations  o f t h e M a c P h e r s o n C o m m i s s i o n , t h e National  (1967)  made  a  significant  the establishment  (CTC), and,  freedom  pay" concept a  and  reality.  spirit  for  bear  facilities  duty.  While  Act  t h e "user  mode  considerable and  f o r minimal  o f a l l modes t o a l l o w  introduced  that  provision  which  combined  i n addition given  wide  departure  and c o n t r a r y  policy  Transportation  i n i t sprovision  of t h e Canadian Transport a l l existing  Commission  regulatory  t o t h e MacPherson  advisory  and  powers  unrelated  agencies Report, to  i t s  regulatory function.  E v o l u t i o n o f t h e F e d e r a l Department o f T r a n s p o r t  At  the time of Confederation,  - 132 -  railway related projects  came u n d e r of  the Inter-Colonial  Railways  and C a n a l s  Department former time, the  took  The C i v i l  National  rail  freight  had  Branch added  operational  authority  services  and  there  responsible  for rail  Department  of  department  and n a t i o n a l  existent  or  Transportation Glassco  Act  were  ad hoc  i n 1967.  Commission  than  on  railway  services.  matters.  actually  modes.  involved i n  a handful  t h e passage  This  policy, the  over  officials  marine  was  to  t o dominate t h e  t h e a i r and m a r i n e  in  5 9  d i d have s i g n i f i c a n t  transportation  up  of  The r e s u l t was  control  and highway  Transport  this  responsibil-  transportation  h a d 11,300  less  by  the  and i t subsumed  related  continued  i n both  comparison,  which,  i n 1935.  no  5,900  included  o f t h e Department  t h e department  1968, t h e department  I n 1935 a  units i n the government.  rates  virtually  However,  which  Branch  transport  of national  operations.  duties.  and C a n a l s  a Highways  Aviation  perception  department  these  created  of the largest bureaucratic  public's  air  was  D e f e n s e was a l s o  While  By  over  o f Marine's  On c o m p l e t i o n  i n 1879, t h e Department o f  of Railways  had e s t a b l i s h e d  Department  o f P u b l i c Works.  Railway  of Transport  Department  ities.  one  t h e Department  of As  an  officials such, t h e  operational  policy of  In  6 0  was  the  non-  National  was s i g n i f i c a n t s i n c e t h e  Government  - 133 -  Organization  i n 1963  recommended  that  The  Transport  the  basis  a  separate  Department  that  A i r Department  resisted  t h e MacPherson  need  f o r developing  embraces  a l l modes o f t r a n s p o r t  t o the other  problem branch  was  however  that  and, t h e r e f o r e ,  transportation policy. to  advise  main  Department ation  was  This  extent  without  a  accounts  f o r the provided  to  Commission  i n 1959.  t h e National  of  allocated  Following Transport  research  for  t o a newly  Canadian Transportation  of  Transportation  responsibility  recommendations  matters.  The  branch, the  "railway-oriented" ( p r i m a r i l y b y PCO) In addition, the  Act  in  1967  and  regulatory  also policy  agency, t h e  Commission.  t h e passage  o f t h e NTA, s e n i o r  (DOT) management c o n t i n u e d  matters.  policy  h a d no n a t i o n a l  research  created  r o l e o r even a s t r o n g  on o p e r a t i n g  The  an o v e r a l l a p p r o a c h t o t r a n s p o r t -  w h i c h were  creation  6 1  h a d no  policy  terms o f r e f e r e n c e t h e MacPherson  growth."  t h e Department  that  transportation  on n o n - o p e r a t i o n a l  that  d i d n o t have  policy.  o f economic  policy  T h e r e was no one i n t h e D e p a r t m e n t  the Minister  problem  and r e l a t e d  to a large  on  had emphasized,  transportation  elements  created.  recommendation  Commission  "...the  needs  this  be  role,  t o eschew a p o l i c y  concentrating  The c l a i m was t h a t  senior  i n t e r p r e t e d t h e r o l e o f t h e Department w i t h i n  - 134 -  Department  instead  management  the national  transportation soon  found  Trudeau  In  itself  January was  organization  management Force  1969 a  of as  with  new  deputy  to  DOT  appointed  instrument  step  The  Department  priorities  of the  6 2  changes  Coordination  too narrowly.  out of  Government.  Stoner,  an  framework  such  and  coordination  secretariat  process.  He  and  for  subsequently  Mr.  quickly  as a T r a n s p o r t a t i o n  policy a  minister,  the  a  Gerald  introduced Council  as  Bureau  of  departmental  appointed  a  Task  t o e x a m i n e DOT'S o b j e c t i v e s .  The  Task  Force  resulted i n the introduction i n  of t h e m i n i s t r y concept*  a n d new d e p a r t m e n t  ministry  created  executive  for  policy  the  operating  Canadian unit  generally, Crown  and p l a n n i n g ;  Transport  s e t up  to  including  with  extensive  administrations,  Surface  was  was  deal  centralized  Administration  the roles  A  support  autonomy was g i v e n t o  including  with  objectives.  1970  a newly and a  transportation  created planning policy  o f t h e CTC a n d r e l e v a n t  Corporations.  *In 1970 the department referred to itself as the Ministry of Transport. It calls itself today. Transport Canada. However, the legally correct term is Department of Transport.  -  135 -  The  r e s u l t s were d i s a s t r o u s  for thefollowing  reasons:*  1)  The M i n i s t r y concept was s u p p o s e d t o emphasize policy-making but t h e massive a i r and marine administrations r e s i s t e d a t t e m p t s t o c o o r d i n a t e and integrate multi-modal p o l i c i e s .  2)  C o n f u s i o n d e v e l o p e d between t h e department and t h e Commission r e g a r d i n g t h e paramount r o l e f o r a d v i c e t o the m i n i s t e r on p o l i c y m a t t e r s .  3)  The M i n i s t e r o f T r a n s p o r t , Mr. Marchand under c o n s t a n t p r e s s u r e t o address t h e transportation system which . arose MacPherson Commission's recommendations t h e NTA) i n t h e a r e a o f s u b s i d y a n d r a t e were n o t a d d r e s s e d .  4)  W e s t e r n Canada was p a r t i c u l a r l y c o n c e r n e d w i t h what i t saw a s a l a c k o f u n d e r s t a n d i n g o n t h e p a r t o f t h e department i n a l l e g e d d i s c r i m i n a t o r y f r e i g h t r a t e s .  Transportation  In  the  Task Force  1974 t h e M i n i s t e r  described Speech  Canada's  of Transport,  transportation  policy  announced  comprehensive  review  i t s intention of  30 t h a t to  transportation  Department o f T r a n s p o r t Task F o r c e , under Jim  Mr.  Marchand,  a s a "mess".  f r o m t h e Throne on September  Government  ( 1 9 7 3 - 7 4 ) was chaos i n t h e because t h e (embodied i n interventions  In  year, the  carry policy  out  a  by  a  the d i r e c t i o n of  Davey.**  *The following conclusions are based on the author's 12-year tenure as a Senior Policy Advisor with the Department of Transport. **Jim Davey was a confidant of the Prime Minister and was one of the PMO technocrats who transformed government operations.  - 136 -  Among inclusion and  the  chief  aims  of regional  dealing  with  of  the  objectives  freight  rate  concerns.  i n the freight rate  and  transport  western  The the  seven  formation  dramatic  of  changes  b o t h i n Canada was  first  in  subsequent  leading  decisions. the  commodities capacity  in the  source with  very would  lead  f o r new p l a n n i n g  place  the required  distribution  increase a  resources  to northern  energy  f o r new the  scene i n  a much b i g g e r  factor  planning  and  policy  t h e Task  Force  believed  in  number  system.  of  environment,  experienced  had  and  number  f o r scarce  o f t h e changed  to  a  world  The  necessitating  transport  seen  demands  environment,  rapid  out of the  consequent  transportation  In this  Force  o f t h e NTA  attention  t o energy becoming  problems,  national  Demand  policy  ( s e e P a g e 155) .  and e c o n o m i c  r e s u l t i n g i n greater  major m a n i f e s t a t i o n s 1973  cause  i n the social  had  the  of the federal  t h e passage Force  infrastructure.  late  that  t h e Task  as a s u p p l y  transport  between  were  Task  emanating  Conference  and e l s e w h e r e .  increasing,  Canada  the  years  The  accord  ministers,  Western Economic O p p o r t u n i t i e s  Force  i n transportation  was i n s t r u m e n t a l four  Task  demand of  major  large-scale In turn,  and p r o g r a m m i n g  for  bulk  transport  expansion  t h e s e needs  initiatives  of  were  t o put  i n f r a s t r u c t u r e and a l s o t o i n f l u e n c e  of population  and e c o n o m i c  - 137 -  activity  in a  s i g n i f i c a n t way  The  and  Task  t h e r e b y cope w i t h  Force  was  also  major problem areas such  as  policy,  but  and  a  rationalized  strengthening  of  regional  asked  to  disparities.  focus  on  several  a more e f f e c t i v e c o s t viable  rail  recovery  passenger  federal-provincial  and  system  government-  industry relations.  Finally,  the  organizational function CTC  and  and  Crown  were  the  department,  and  the  DOT  on  Transport  outline  the  for  of  principles  new  in  the  several  in  could  achievement  be of  June  program  to  address  p o l i c y and respective  Task F o r c e , 1975  Section  3  planning roles  of  Minister  i n 1975. (1)  a total  NTA  and  and  equity  138  -  and  6 3  transport the  of  of  of his  and  an  There policy  substitute among  transportation  economic  -  changes.  the  e s s e n t i a l instrument  national  objectives  These p r o p o s a l s ,  accessibility an  the  Minister  Parliament,  policy  between  of  the  in  organization  differences  called for:  Canada p r o v i d i n g  the  transportation  p r i n c i p l e s proposed  users,  instructed  r e l a t i o n s h i p between the  work of  tabled,  important  things,  was  Corporations.  Based  proposals  Force  i s s u e s , p a r t i c u l a r l y the  within  the  Task  other  system f o r  treatment  for  support for  the  social  objectives;  (2)  the  attend this  assumption  to  the  and  mode f o r s p e c i f i c  NTA  responsibility  provision  purpose;  The  of  of  goals  of  an,  favour  a  for  system  and,  users",  be  retained  "...economic,  system"  providing  phrase  than "adequate".  total  to  system  o f t h e most  were  f o r the  "...accessibility  a  government  for  appropriate  services.  transportation  objectives  efficient  (3) u t i l i z a t i o n  adequate of  an  by  which  I t was  but,  was  efficient  de-emphasized  support  and  equity  of  treatment  c o n s i d e r e d more  least  relatively,  in  national  of  proposed that the term  at  and  specific  "efficient" reduced  in  prominence.  The with  Minister  new  legislation  discrimination the  CTC.  major  also  As  capacity  In Task  a t WEOC  his intention  with and  alleged to  p r o p o s a l s were  change  outlined  (especially  to r e v i t a l i z e  rail  in  to  proceed  freight the  rate  role  of  to deal  with  western  and  passenger  wherever  viable.  August  Force,  Minister  deal  concerns  n o r t h e r n C a n a d a ) and t h i s was  to  raised well,  announced  of  1975,  J i m Davey d i e d  although  functioning  Transport  John  accidentally under  retired  Baldwin, eventually  - 139  -  and  the  Deputy  ceased  to  exist.  J e a n M a r c h a n d was e v e n t u a l l y  Without  Jean  Marchand  fundamentally greater  Force  t o give  i s interesting policy  J i m Davey  and  effect  factor  did  to allow away.  d i d prepare o f t h e Task  change  i n this  evidence  and i n t e r e s t  that  Bill  (Bill  C-33  for  at least  C-33 was i n t r o d u c e d  t o amend  of  national  a  fundamental t h e strong  changes  depended  to on  the the  Pepin.  C-20)  i n t h e House  o f Commons i n  t h e National Transportation Act (1968) a n d  Department of Transport Act f o r t h e objective  and  that  on t h e c a p a b i l i t y  despite  commitment o f o n e i n d i v i d u a l - J e a n - L u c  L e g i s l a t i v e Proposals  t h e departure  T h e same  support  thrust  f o r a new  But i tappears  depends  thesis,  group  the initial  reasons  n o t go away w i t h  of individuals.  arises  1977  to  withered  aspects  that  Marchand.  i n policy  determination  Rate,  t o note  and Jean  question  Crow  policy  of Transport  t o some  Lang.  the thrust  t h e provinces  t h e Department  transportation  major  of  by Otto  Report.  It  of  transportation  involvement  legislation  and J i m Davey  change  Nevertheless,  replaced  the  purposes o f r e - d e f i n i n g t h e  transport  - 140 -  policy,  authorizing  the  consequent  of  t h e CTC  in  respect  Bill  rearrangement of relevant  and  the department  of f r e i g h t rates  C-33  and  objectives  and  principles  Commission  relations  i n three  and  duties Act  matters.  section;  section,  and  t h e Railway  t o amend  and o t h e r  c a n be c o n s i d e r e d  powers  (2) (3)  parts: the  the  (1)  the  Department/  freight  rates  section.  The  provincial  Atlantic  Canada  importance  on  governments,  and  the  the  on  the  responsive  to  regional  contrast, role in  notion  carriers  NTA,  was  economic development  Both  industry  that  principles  development were  competition, made  as  and  the provinces role  currently to  that  be In the  embodied  social  and  i n regulating  new  power o f p o l i c y d i r e c t i v e s f o r t h e were c h a l l e n g e d .  the proposed  in policy  t h e CTC's r o l e  a streamlined  goals.  welcomed  and  t h e CTC  section  should  concerned  secondary  in  objectives.  c l a r i f i c a t i o n of the M i n i s t e r ' s  to  those  considerable  transportation  shippers  being  placed  and  economic  and  o f e f f i c i e n c y and the  prairies,  objectives  especially  particularly  development  transportation.  Only the  Governor-in-Council  Both groups were i n f a v o u r o f  a p p e a l s procedure under S e c t i o n  - 141 -  23 o f t h e  NTA  NTA  and u r g e d f u r t h e r b r o a d e n i n g o f t h e b a s i s  and an a c c e l e r a t i o n up o f t h e a p p e a l s  T h e r e was a good d e a l freight  rate  Shippers  and c a r r i e r s  change  and  satisfied their  the  right  with  the  that  opposed  provincial  to  Ontario,  generally  section  t o o much  governments  proposed.  the provisions  were  rate  i t proposed  was  regulations.  provinces  freight  t o t h e package of  dis-  because,  from  intervention.  The  v i e w e d i t as a s t e p  i n the  direction.  A  key element  to  become  instrument regional, equity  a l l  Heaver  legislation  was  regional reality  of  users.  also  to  ...and  to decisions  transport become  an  the  that  a  expectations  - 142 -  provide  were  eleven  legislation.  that  the  new  changes  would  run  contrary  result  to  the  argued  services as  and  There in  Nelson  transport  match  while  objectives  contained  and  dissatisfaction to  for  misguided  of leading  that  i t was  economic  treatment  Professors  was  f o r t h e a c h i e v e m e n t o f n a t i o n a l and  and  in  provision  C-33  "efficient",  social  of  risk  of B i l l  of support  principles  the  generally  Atlantic  viewpoint,  prairie  was  changes  t h e minimum and maximum r a t e  Quebec  process.  of opposition  legislative  f o r appeals  to the e f f i c i e n t  while of  exacerbating the f a i l u r e  which  the  of  revised  s t a t e m e n t o f p o l i c y may e n g e n d e r .  Bill of  C-33 d i e d  i n t e r e s t on t h e p a r t  provinces, as  Bill  First to  on t h e Order  Bill  of both  i t was r e i n t r o d u c e d  C-20 i n November  Ministers'  i n 1977.  revised  1978, i m m e d i a t e l y  there  Because  t h e A t l a n t i c and p r a i r i e  i n a somewhat  Conference.  C-33 a l t h o u g h  Paper  I n essence,  prior  form  t othe  i t was s i m i l a r  w e r e some c h a n g e s i n t r a n s p o r t  objectives  and  principles,  and  the  directives  from  the Governor-in-Council  power  of  policy  t o t h e CTC was  deleted.  The  work  example  of  provincial and  C-33.  opposed  to  envisioned  In Bills use  executive  links  assist  Carriers  at  was a l s o  work.  a n d some  a  Federal  had e s t a b l i s h e d  l e d to the thrust  the legislation,  shippers  and formal  continued i n  generally  particularly  good  to  the  were role  f o r the M i n i s t e r o f Transport.  summary,  t h e work  o f t h e Davey  C-33 a n d C-20 r e f l e c t e d  degree i n  Force  and o f f i c i a l s which  transportation  greater  Task  federalism  ministers  informal  Bill  o f t h e Davey  the  a desire  p o l i c y both  of  of  - 143 -  and  F o r c e and  by government t o  a s a means  competition  realization  Task  f o rachieving  efficiency,  national  and  a  and t o regional  objectives.  The i n i t i a t i v e the  failed,  shippers  feared  conflicts  as t h e y w o u l d  remaining  c h a r a c t e r i s t i c of  discussed  is  that  consequences  concerning  either  a service  industry  of  addressing  objectives. conundrum issue:  Since  identifying the  that  four  made  rate of  railway  in  freight  discriminate freight  to discuss  rates  against rates  means  politics"  Rate.  issue  rates  i s there  a  "provincial The  from both  provinces  their  a specific  as  historically  discriminate  region.  This  substance  - 144 -  policy  argued  against  the  processing raises  by  Second, industry  CN how  and  of  three  t o t h e argument  are established  i n determining  freight  perspective.  have  t h e west?  of  of  during  a public  t o e s t a b l i s h more v a l u e - a d d e d  First,  demand, o r  regional  grievances  be a n a l y z e d  freight  products  concerns.  are  be  t h e Crow  western  opportunities raw  will  freight  of  railway  as  this  a federal-provincial relations  The  transportation  to derived  and  be  t h e Crow R a t e was c a u g h t up w i t h i n  rate grievances w i l l and  of  to  and  the context  resolution  policy  The  of transportation  responding national  policy.  goals  an a t t e m p t  western  puzzle  the role  users/  federal-provincial  transportation  overriding  advisors,  means  of  affect transportation  policy  as  probably because  CP  that to  significant  location?,  and  third,  should  the  transport  support r e g i o n a l economic  Section  3  of  of  economic,  efficient  This  statement  policy as  one  of  policy, this  the  1967  principles  a  processes  or  role  which  understanding  manner  in  is of  no  situations. in  of  which  the  attempt  It  the  a  down  a  create not  Baldwin  a  just 6 5  it  framework  of  Transport  does admit t h a t were  not  followed  forces  system  that  to  government  responsibility  raises  a  definition  section  is  raises  words  in  the  -  145  -  for  serious  legislation  to  is  be  meet had the  upon  there  an  applied  to  questions  section  of  question  sections  nor  the  understood  commercial  imply  in  of  public fully on  3  also  "an  system."  to  to  regulatory  This  placing  be,  a whole,  statute  overall  the  as  lay  solely  6 6  shall  a c t i o n . However commendable  the  acceptable how  to  policy  transportation  passed),  Section  system.  basic  (Deputy M i n i s t e r  and  the  purpose of  there  specific  did  the  according  to  was  relied  competition  direct  the  3  manipulated  there  first  government nor  Section  objectives  to  the  Baldwin  legislation  transportation as  adequate  statutes  was,  that neither  inter-modal its  that  Moreover,  first  and  is  transportation  problem.  initiative  whether  states  and  for  which  a commendable c o u r s e o f  when t h e  and  Act  NTA  represents  framework  a railway  was  that  be  goals?.  the  statement  system  were  as  to  the  drafted.  Legislation  i s often drafted  interpretations  from  i n vague  terms t o a v o i d  undermining  the  rigid  legislation's  intention.  Transportation, is  as t h i s  c o n t i n u a l l y expected t o forward  and  political  in  Section  goals. 3  Langford  between  transportation system.  Westmacott governments discovered position. federal the  thesis  6 8  during that  a wide  range  of social  notes t h e basic  conflict*  'adequate'  the role  and  'efficient'  of the three  prairie  p a s s a g e o f t h e 1967 l e g i s l a t i o n there  was  no  consistent  M a n i t o b a and Saskatchewan were  NTA p r o v i s i o n s  advanced,  6 7  examined  government's  branchline  an  has a l r e a d y  decision  regional  appeased  by t h e  t o exempt t h e Crow R a t e f r o m  and t o remain p a s s i v e  abandonment.  a n d he  The changes  on t h e i s s u e o f  government  advocated  fundamental  to  structure.  Westmacott observes t h a t :  the  of  Alberta  freight  rate  "...consultations between t h e two l e v e l s o f government d u r i n g enactment o f t h e l e g i s l a t i o n r e v e a l e d t h a t , f o r t h e most p a r t , t h e d i r e c t consultations between federal and p r o v i n c i a l p o l i t i c i a n s and o f f i c i a l s were u n s t r u c t u r e d and  *The transportation system historically is expected to provide an "adequate" system to support a wide range of social and political goals. At the same time it is expected to keep its prices low, based on efficiency.  - 146 -  so general governments nature of legislation Commons."  i n nature that the provincial were u n c e r t a i n as t o t h e p r e c i s e the federal proposals until the was tabled i n t h e House of  69  The took  federal  the position  provinces  parliament.  The  that  before  exclusively  era  Minister  within  the  the issues  of  that the  i n 1968 u s h e r e d  the provinces.  the i s  federal  The new  Ottawa.  Concurrently  i n w e s t e r n Canada t h a t  prairie A  regional  Prime  provinces Prairie  a transportation  policy.  acknowledged  there  i t must  position  Economic  was  develop  on  and, a t times,  i n 1965 a n d o n e o f i t s f i r s t  Premier of A l b e r t a  i n a new  ' r e g i o n a l d e s k s ' * t o keep h i m i n f o r m e d  unified,  provinces.  established develop  jurisdiction  with  outside  common,  concerning three western  to consult  legislation  e l e c t i o n o f Mr. Trudeau  of consultation  more  Pickersgill,  7 0  growing r e c o g n i t i o n a  Mr.  he d i d n o t h a v e  introducing  Minister established of  of Transport,  matters the four  Council  was  priorities  was t o  The n e w l y e l e c t e d  (1971)  that:  *Jim Davey operated the "western desk" prior to being transferred to the Department of Transport to assist Mr. Marchand to sort out the "transportation mess."  -  147 -  " . . . p r o v i n c i a l governments w i t h i n a p a r t i c u l a r region with differing political affiliations and t h e e x i s t e n c e o f p r o b l e m s p e c u l i a r t o o n l y one province inhibit t h e development of a regional policy p o s i t i o n . " 7 1  The  1983 Crow  made b y P r e m i e r  Another  Rate  debate  Lougheed t w e l v e y e a r s  federal election  reaching  impact on t h e matter  Canada.  The L i b e r a l  and  found i t s e l f  in  British from  were  dropped  Conference  of freight  and i t s  and  was  i n 1972 was t o h a v e  Government  7 i n 1968. a  the supposition  earlier.  rates  dropped  prairie  As a r e s u l t , Western  established  to  I t lost total  a far-  i n western  46 s e a t s  i n a minority position.  Columbia  seats  supports  overall 12  dropped  the 'regional  Economic explore  seats to 3  desks'  Opportunities potentials for  economic and s o c i a l development i n w e s t e r n Canada.  Western Economic O p p o r t u n i t i e s Conference  On  July  24-26,  1973  a  rare  Calgary.  The f e d e r a l g o v e r n m e n t ,  Minister  and  the  four  western  several  western Canada.  senior  Premiers I t was  an  event  place  discuss  in  by t h e Prime  M i n i s t e r s , met  opportunity  - 148 -  took  represented  Cabinet to  (WEOC)  the  economy  f o r the  with of west  logically claim  and d e f i n i t i v e l y  of grievances.  t o l a yout i t s deeply  In their  opening  Prime M i n i s t e r , the western Premiers  rooted  comments  tothe  said:  "The p a t t e r n o f s e t t l e m e n t a n d d e v e l o p m e n t h a s been i n f l u e n c e d by economic, f i n a n c i a l and t a x p o l i c i e s o f t h e f e d e r a l government, w h i c h e a r l y assisted the concentration of the nation's business and i n d u s t r i a l activity i n central Canada. These p o l i c i e s , w h i c h have l e d t o t h i s concentration of financial and industrial resources and p o p u l a t i o n , have worked a g a i n s t the allocation of financial and p r o d u c t i o n r e s o u r c e s t o b r i n g balance t o economies o f a l l regions of Canada." 7 2  For WEOC,  h i s part  argued,  traditional  Mr. Trudeau,  "...that  division  i n h i s major  i t was  of  time  labour  between  hinterland  and t h e c e n t r a l  metropole."  broadside  at  production  stated,  "Regional  reduced  and  economic  a n d O t t a w a must p u r s u e ,  development across  the staple  of balanced  the land."  The  litany  to  address  re-think the the  western  After firing  7 3  theory  at  Mr.  specialization  this  Trudeau must  be  as a b a s i c p o l i c y g o a l , t h e  and d i v e r s i f i e d  regional  economies  7 4  of western grievances  classic  and d e e p l y  banking  system  rooted,  ranging  t o f e d e r a l purchasing  - 149 -  o u t l i n e d a t WEOC w e r e from  attacks  on t h e  p r a c t i c e s b u t two o f  the  major  tariff  areas  structure  Railways' in  of concern and  inhibit  t u r n , favour  raised  discriminatory  four  central Canada.  by  rail  western  the  items  was r e q u i r e d .  road-beds  billion  Premiers  oriented  expenditure  that  t h e Canadian  pricing  by  the  l o c a t i o n o f i n d u s t r y on t h e p r a i r i e s and,  Table 6 o u t l i n e s t h e l i s t the  were  alone  7 5  of proposals  put forward  a t WEOC.  The l i s t  and,  every  in  The c o s t  was e s t i m a t e d  by  i s dominated  case,  federal  i n 1975 t o t a k e t o be i n e x c e s s  over o f $3  dollars.  T a b l e 6:  List of Transportation Proposals W e s t e r n P r e m i e r s a t WEOC ( 1 9 7 3 )  Section 3 objectives.  2.  Federal  3.  Establishment of a set f r e i g h t rates.  4.  Federal Rail.  5.  P r o v i n c i a l input into r a t i o n a l i z a t i o n of branchlines and f e d e r a l g o v e r n m e n t t o p a y c o m p e n s a t i o n t o a f f e c t e d parties. Improved port facilities at Prince Rupert and Churchill.  7.  to  reflect  regional  by  1.  6.  (NTA)  Made  economic  c o n t r i b u t i o n t o t h e f i x e d c o s t s f o r a l l modes.  government  federal-provincial institution to t o purchase  roadbed  o f CN a n d CP  Construct a rail l i n e between A s h c r o f t and C l i n t o n , B r i t i s h C o l u m b i a , t o c o n n e c t BCR w i t h CN/CP R a i l .  Source:  Premiers' Transportation Position Paper (WEOC) 1973  - 150 -  Table 7 federal  outlines  Department  Conference. programs  t h e programs of Transport  I t should  listed  relationship  were  t o WEOC.  arising  be p o i n t e d committed  and p o l i c i e s  of the  o u t o f t h e WEOC  out that  expenditures  The main e x c e p t i o n s were  many  of the  without  any  t h e highway  p r o g r a m s , w h i c h t o t a l l e d $278 m i l l i o n , a n d w h i c h r e p r e s e n t e d less  than h a l f  o f t h e t o t a l committed expenditures.  T a b l e 7:  F e d e r a l Government T r a n s p o r t Programs and P o l i c i e s E m a n a t i n g o u t o f WEOC ( 1 9 7 3 ) . ($ M i l l i o n s )  Infrastructure i) ii) iii) iv) v) vi) vii )  II  III  Cost  N o r t h w e s t B.C. R a i l P r o g r a m Highway S t r e n g t h e n i n g Program Western N o r t h l a n d Highways P o r t Development a t C h u r c h i l l P o r t Development a t P r i n c e R u p e r t P o r t Development a t Vancouver A i r p o r t Development a t S a s k a t o o n Vancouver Calgary  Consulting  $167 $ 78 $200 $ 18 $ 12 $ 36 $ 4.2 $ 74 $ 24 $613.2  Mechanisms  i) ii) iii) iv)  F e d e r a l - P r o v i n c i a l Committee o f M i n i s t e r s F e d e r a l - P r o v i n c i a l Committee o f O f f i c i a l s P r o v i n c i a l access t o c o n f i d e n t i a l r a i l cost data Provincial input into a i r bilateral negotiations with foreign countries  Joint  Study Program  i) ii) iii)  R a i l P r i c i n g Impact S t u d y R a i l Roadbed C o s t S t u d y J o i n t CN/CP R a i l T r a c k U s a g e S t u d y  Source:  Annual Report of Federal-Provincial Transportation, 1974  - 151 -  Committee on Western  The  most  establishment a  number  "firsts". were  transportation Mr.  policy  -  received  rates the  service.  "cost" time,  a  region Now  provincial  directly contrast  the  first  believed  relative  i t was  possible  these  movements.  governments were  discussions  with  provincial on  national  t o t h e days of provincial  cost that  data.  the  The  the railways'  (discriminatory) to  the  resulted i n  time  rail  i n higher  was  time,  stark  historically  o u t some o f  bilateral  response  first  confidential  policy resulted  i n their  the  consulted  For  western provinces pricing  For  being  Pickersgill.  governments  federal  o f c o n s u l t a t i v e mechanisms w h i c h  of  governments  significant  the cost  of  freight  providing  f o r the provisions Also  f o r the  directly  United  to  first  consulted  States  over  on air  routes.  The funded  third  area  was  specific  The  importance of these high  freight freight and  the establishment  ($500,000) f e d e r a l - p r o v i n c i a l s t u d i e s  the  a  on  freight  public rates, rate  rate  profile  grievances  studies  was  issue,  i t i s necessary  jointly  dealing  discussed  at  t h a t when d e a l i n g  such to  of  as  specify  with WEOC. with  discriminatory exactly  what  i s d i s c r i m i n a t o r y , what c o m m o d i t y i s i n v o l v e d  w h a t i s t h e o r i g i n and d e s t i n a t i o n o f t h a t c o m m o d i t y .  - 152 -  The  joint  questions  studies  and, where  were  intended  to  answer  required,  recommend  steps  to  these  end  the  discrimination.  The the  immediate  federal  issues the  government's  raised  Alberta  Peacock,  reaction  a t WEOC was Legislature  in  regard  to  a  by  the  response  western to  positive. the  the  On  Industry  recent meeting  P r o v i n c i a l C o m m i t t e e on W e s t e r n  provinces  to  transportation  March  13,  1974  Minister, of  the  Transportation,  in Fred  Federal-  said:  "Mr. S p e a k e r , I would have t o say t h a t the f i r s t m e e t i n g was v e r y p r o d u c t i v e i n that for the first time the federal Minister of T r a n s p o r t , t h e Honourable Jean Marchand, agreed t h a t major r e v i s i o n s are r e q u i r e d i n n a t i o n a l transportation policy. I f you e x c u s e t h e pun, Mr. S p e a k e r , I b e l i e v e we a r e on t h e right track.' 6  In Mr.  a  subsequent  Peacock  point  of  talked  about,  view..."  confidential  rail  speech  7 7  cost  in  i n the  "...a  Legislature,  breakthrough from  response data  Alberta  to  to the  the  a policy  transfer  prairie  of  transport  ministers.  Mr. M a r c h a n d ' s a p p r o a c h , t o a d d r e s s t h e  - 153  -  transportation  related  grievances  position as  that  such,  from  western  t h e r e was  i t was  up  freight  to  Mr.  western  politicians.  CBC-TV for  The  Marchand  National,  western this  Did  the  seats,  1974 an  government. Columbia,  2  in  Manitoba  if  the  role  outcome  of  example,  ever  the  received  Liberal  and of the  As  already  any  words of  Mr.  support  from  benefit  from  Liberals in  There  Marchand's election  Liberals  and  formed  gained  Saskatchewan  Alberta.  the  seats,  4  transport  but  the  in  remained  i s no  way  of  policy  Liberal per  received  a majority  seats  and  v o t e s i n S a s k a t c h e w a n i n c r e a s e d t o 31 c e n t i n t h e 1972  such  Government  Election  i n c r e a s e o f 32  seats  have k i n d  on  support?  General  The  from  reported  that  to  strategy  support  i t was  It is unlikely  7 8  and,  officials  a brilliant  "Western P r e m i e r s  predecessors  rare p r o v i n c i a l  In 141  For  that,  Canada.  I t was  the  discrimination  r e c e i v e d unprecedented  Transport M i n i s t e r . "  Marchand's  rate  to accept  federal-provincial  document t h e d i s c r i m i n a t i o n . because  C a n a d a , was  British unchanged  determining affected  share cent  the  of  from  total 25  per  election.  indicated,  resulted  in  Saskatchewan's  Transport  Minister  and  he  the  1974  Otto turned  - 154  -  Lang his  election becoming attention  eventually the to  new grain  handling  and  transport  matters  in  lieu  t r a n s p o r t a t i o n p o l i c y and w e s t e r n f r e i g h t  Mr.  Lang  Provincial doing,  Committee  the intense  called  the  ministers. turn  handling  western  Lang 3  was  of  t o addressing  should  industrial  National  development,  evidence  the  Federaland  transport  Mr. Lang wanted t o associated  that  Act  five  such  time.  as Mr.  changes t o S e c t i o n to  "accommodate"  d i d not believe  t o support  with  The  issues  at this  discussing  he  i n so  mechanism  i n the west.  insisted  because  grievances.  western  problems  Transportation  t h e r e was s u f f i c i e n t two  by  n o t be a d d r e s s e d about  national  consultative  and t r a n s p o r t a t i o n  dissatisfied  the  down  previously,  ministers  rate  Transportation  Formula"  indicated  transport  Crow R a t e  on Western  "Marchand As  7 9  closed  and c o o p e r a t i v e  his attention  grain  the  effectively  of  s u c h a move.  that The  major  freight  studies  completed  i n late  1974 and t h e r e s u l t s d i d n o t s u p p o r t t h e  historical never  grievances  officially  8 0 , 8 1 m e n t i o n e d o n P a g e 152 w e r e  of the western  shut-down  the  provinces.  Mr.  committee  but  he  at  by  the  Lang never  a g r e e d t o any f u r t h e r m e e t i n g s .  Freight  The  Rates  position  put  forward  - 155 -  WEOC,  four  Premiers,  was t h a t  discriminatory  the western  freight  industry  i n t h e west.  question  as t o whether  set  f r e i g h t rates  cost  of  The P r e m i e r s '  i s that  leaving the prairies, on  low value  to  cost  bulk  since  compete  on  freight  bill  centred  should  a move  rates  i t could  location  also  to  world  products  with  the  the  latter  on m a n u f a c t u r e d  goods  r e s u l t i n higher  markets  and  t o the export  there  i s no  evidence  rates  a r e t h e major  (coal,  the shipper  port.  t o support factor  sulphur  As  and  must  rates  that  i n determining  close grain),  pay t h e  discussed  the notion  to  than a  p r o d u c t s w h i c h o f t e n move a t r a t e s  these  of  on t h e  be a l l o w e d  difficulty  while  r e s u l t i n lower  the  because  of service rather  The  8 2  suffered  case  the railways'  basis."  positions  approach could  affected  on, "...a value  service  Premiers'  rates  provinces  below, freight  location  of  industry.  To  the  contrary,  estimated  (based  on  government  spent  about  railways' little  In freight  subsidies  between DOT  figures)  five  i n lieu  1960  billion  Waters  8 3  1984  i t is  that  the  federal  dollars  in  direct  of f r e i g h t rate increases  i n t h e way o f new i n d u s t r y b e i n g  1984  and  concluded  developed.  his  analysis  r a t e s and r e g i o n a l d e v e l o p m e n t by s t a t i n g :  - 156 -  with  on  the  " . . . t h e a b i l i t y o f s h i p p e r s t o pay h i g h f r e i g h t r a t e s r e f l e c t s the u n d e r l y i n g p r o f i t a b i l i t y of the products being transported. High costs and/or lack of market are what inhibit development. The discriminatory elements in commercial f r e i g h t rates reflect rather than determine these u n d e r l y i n g economic c o n d i t i o n s . I n d u s t r i a l d e v e l o p m e n t and d i v e r s i f i c a t i o n are often sought i n response to political-social c o n c e r n , i . e . , apart from the economic m e r i t of the proposals. But e f f i c i e n t m a r k e t s i n c l u d i n g those i n t r a n s p o r t a t i o n w i l l not foster uneconomic developments."  As 1973  previously  was  to  ignore  opportunity  to  results  the  162) To  of  failed the  to  the  two  were  academics involved.  the cent  months  part  rail pending  of this  "across revenue) the  west  to allow  rate  with  grievances. studies  a  documented the  western  arguments.  As  the  public.  to  Over  one  Mr.  of  the  Marchand's  issue,  were  items"  frozen  completion  - 157  of  -  at the  economic a  result,  the  never studies  consultants five  desire  to  increases  on  ( a f f e c t i n g 22 WEOC joint  or  governments  sincere  freight rates  board  Page case.  were  time,  professional  to  the  funded)  an The  (see  questioned  publicly  in  the west  studies  (although  request  grips with  so-called of  both  available  As  freight  the  traditional  on  r a t i o n a l e and  major  to  Marchand's p h i l o s o p h y  i t s freight rate  provide  released  made  come t o  two  studies  officially  such  document  contrary,  soundness of  i n d i c a t e d , Mr.  for  per  eighteen  freight  rate  studies. purse  The  freeze  $157 m i l l i o n  achieved.  The  freight  like  development  freight  these rates  two  and n o t h i n g  rate  issues  the  public  of substance  raises  facts  and a n a l y s i s  transport  policy  rallies  routinely  an  play  in a  was  important  any r o l e i n  federal  that  politics, failure  effects  state  federal  freight  Allan policy  and  constrains  and p e r c e p t i o n s  of response  g o v e r n m e n t b u t more s o t h a t  claims of discrimination t h e west  government  studies  relates  government r e f r a i n s  to attack  from such  - 158 -  The  major  on t h e p a r t  of  a n d , i n many  The f a c t the results  Ottawa  tactics.  "Westerners  8 5  t o t h e p o i n t made i n C h a p t e r  are "free"  former  r e g i o n and i n  s t o o d up t o a n a l y s i s  d i d . not publicize  are  few o f t h e w e s t e r n  h a d no common p o l i c y .  federal  As  noted,  matter."  forums,  tariffs  8 4  their  No,  separatist  polite  truths."  Blakeney  on  alienation?  rates  universal  o f WEOC was n o t l a c k  provinces  on w e s t e r n  studies  Tupper o b s e r v e d , " . . . a t  of as  Premier  beliefs  federal  cases,  federal-provincial  t h e m i d 1 9 7 0 s ) a n d i n more  advanced  Saskatchewan believe  As A l l a n  (during  hideous  major  end t h e debate  they d i d not!  the  of  cost  Canada.  Did  the  eventually  dollars  q u e s t i o n as t o w h e t h e r the  would  but  that the of the  One t h a t t h e the  federal  The  perception  that  prairies  c a n be t r a c e d  Premiers  or t h e i r lack  regional  d i s p a r i t i e s e x i s t on t h e  p a r t l y to the rhetoric of p r o v i n c i a l o f common p o l i c y p o s i t i o n s on m a j o r  areas a f f e c t i n g t h e economic development o f t h e p r a i r i e s .  Westmacott west,  or  and D o r e  even  the  acknowledge  prairies  as  the d i f f i c u l t i e s  a  region,  attempting to e s t a b l i s h intergovernmental  They  cite  affiliations, province could  factors  the existence  and i n e q u i t i e s impede  Westmacott  the  and Premier  interests  of  In  8 6  grievances avoiding  his  with the  provinces  had  transportation governments expertise  of  further  argue  will  continue  own  province  issues  little  of  when  the on  Indeed,  their  time  and  problems were d e v e l o p i n g .  A railway  strike  bottleneck  i n grain  - 159 -  best  occasion  transportation them  and b y  the  prairie  changing while  the  the  1970s,  major  a  "...each  in  t o support  impact  policy.  act  traditional  substance  policies.  that,  to  t o one  resources  regional  grievances,  created  political  peculiar  historical  1973  on  development  little  devoted  differing  o f problems  citing  real  as  when  cooperation.  i n the d i s t r i b u t i o n of  Dore  provincial  demands."  such  face  the  national  the  prairie  ever-increasing transportation i n the F a l l  shipments  of  and b y t h e  Spring  o f 1974 - d e s p i t e  record  grain  p r o d u c e r s were u n a b l e t o g e t a l l t h e i r addition paying that  to lost  vessel  wanted  sector despite  transportation  Nest  ceased  at this  system  Pass  i n 1974.  meeting  held  prairie  agenda.  never p r o p e r l y an  agenda  1970s,  and  shows  items that  West  Germany  high  technology.  with  were  i t was  move  traffic  the railways  purchase of this  of  rolling  policy  became  o f an FP-COWT  At the insistence of the the  Rate  issue c a n be  a lengthy  list  of  branchline  found  on t h e  o f items  i n a one-day m e e t i n g .  t h e p r i c e we p a y f o r f e d e r a l i s m ?  countries  h a n d l i n g and  are a l l p r o v i n c i a l grievances  such  be a d d r e s s e d  reasons  as a r e s u l t o f t h e  t h e agenda  t o WEOC.  n o r t h e Crow  i t i s obvious  to  revenue  neither  T h e agenda  were  where  ( s e t a t 1899 l e v e l s ) ,  Table 8  In  to the grain  the grain point  and t h e e f f e c t  governments,  producers  These were  difficult  subsequent  rationalization  a  maintenance  i n t h e 1950s  obvious  and  reached  Rates  western  from the western P r e m i e r s .  Due t o d e p r e s s e d  branchline  stock  sales,  -  to ports.  h i s attention  time that  increasingly  efficiently. Crow's  to turn  theobjections  was a l s o  becoming  grain  grain  demurrage a t t h e p o r t s .  Mr. Lang  It  or deferred  prices  central  planned  transforming  their  I t i s difficult  - 160 -  could  I s such  In the early  economies economies  t o determine  such  as  towards how t h e  T a b l e 8:  Federal-Provincial Committee on Western T r a n s p o r t a t i o n Committee o f M i n i s t e r ' s M e e t i n g AGENDA  1.  Committee  2.  Priority 1) 2) 3) 4) 5) 6) 7)  8) 9) 10) 11)  3.  2. 3. 4. 5.  5.  The R a p e s e e d D e c i s i o n R a i l F r e i g h t Rate Freeze R a i l Cost D i s c l o s u r e - 6 S p e c i f i c Requests CTC R a t e R e v i e w - 22 A n o m a l i e s CTC P r o c e d u r e s ( S e c t i o n 23) R a t e C a s e s Rate Grouping F e d e r a l - P r o v i n c i a l Highway Programs (a) Highway S t r e n g t h e n i n g (b) Western N o r t h l a n d s (c) Western Highway M i n i s t e r ' s R e s o l u t i o n B r i t i s h Columbia F e r r i e s P o r t s - C h u r c h i l l and P r i n c e R u p e r t Western Region Harbours Board A i r Matters ( a ) R e g i o n a l and T h i r d L e v e l A i r C a r r i e r s (b) A i r B i l a t e r a l s Studies  Railway Pricing Proposals (a) E q u i t a b l e P r i c i n g Technique (b) D e s t i n a t i o n Rate L e v e l P r i n c i p l e R a i l w a y Roadbed C o s t s D i s c u s s i o n on D i s c l o s u r e o f R a i l T r a f f i c and Cost Data t o C o n s u l t a n t s E q u a l C o s t C o n t r i b u t i o n s by Government t o A l l Modes o f T r a n s p o r t S e l e c t i v e Developmental A s s i s t a n c e  Committee 1. 2. 3. 4.  Progress Report  Items  D i s c u s s i o n on C o m m i t t e e 1.  4.  of O f f i c i a l s '  of O f f i c i a l ' s  Tasks  P r o j e c t e d Committee Tasks C h a i r m a n s h i p of t h e Committee R o l e o f Core Group Budget  of  Officials  Other Matters  Source:  Federal-Provincial Committee on Western Transportation Annual Report -1974  - 161  -  resolutions  of  agenda w o u l d competitive  This he  the  so  called  accommodate e f f i c i e n t i n world  Minister  of  minister  his  transport  problem  the  handling  and  l a y the  long  grain issue  item  as  policies  the  FP-COWT  t o make C a n a d a  markets.  p a r t i a l l y explains  became t h e  this  priority  priority  the  Transport was  facing  strategy  to  of  Mr.  i n 1975.  address  As  a western  the  western  Canada:  the  transport  system.  At  standing  L a n g when  immediate adequacy the  core  of of  Crow R a t e s .  Summary  The  purpose  e v o l u t i o n of context the  f o r the  Bearing i t  throughout there and  was could  was  to  transportation policy  discussion  i n mind t h a t necessary of  that  Canada,  of  the  to  trace  the  establish a  Crow R a t e as  an  issue  in  in  its  the  Crow R a t e was  established  to  examine  transportation  period. but  a perception by  chapter  chapter.  was  environment  this  national  following  1899  of  very  At  the  turn  particularly that  railway  existence  - 162  -  the  in  of  the  century  western  Canada,  b u i l d i n g was lead  to  paramount  progress  and  economic  development.  historians  wrote  Laurier's  Railway  governments  Related  that  MacDonald's  Building  having  the  programs.  chapter  both  Laurier's and  were  to  However,  i t is  and  examples  of  coherent  argued  National  a c t u a l l y ad  were  many-  Policy  establish  p o l i c i e s were u n a b l e t o match the  emerging western  Century,  the  in  foundation  By systems  of  1930s  were  two  both  in  this  Policy  and  hoc,  parochial  government embarked,  in  of  of  was  expectations  laid  the the 1930s,  which enabled trucks  to  with  road  handling  the  emerging  transport  issues  on  the  system.  a major  -  developing. between  provinces and  the The  road-building  attract traffic  - 163  from  jurisdiction  system  railway  bashing.  grain  However,  shared  20th and  railway  rationalization the  of  Alberta  and  over  government  over  the  railway  conflict  problem  over  the  expectations  e a r l y p a r t of the  unrealised  over-built.  system  levels  jurisdiction  the  formation  these  vastly  any the  In  f o r w e s t e r n a l i e n a t i o n and  the  prevented  the  1905,  federal-provincial  Part  region.  following  Saskatchewan  the  National  MacDonald's  Policy  theme  costly.  The an  Railway  this  Policy  capacity  nation-building that  to  from the  having federal provinces program  railways,  leaving built  both  evolution  this  What  hardly  government  of which national  chapter  change.  No  attempted  following  until  major  chapter,  by i t s e l f  national  such  rooted  was  existed  a  in  major  was ad hoc  the federal  need  for  national  that  t h e need  identifies  was  over-haul passage  Rate  between  the  insufficient  of  transport  o f t h e 1967 National as J e a n As w i l l  i n d i v i d u a l s played  national  transportation  policy  Marchand  - 164 -  policy  was  Transportation a n d James in  the  r o l e which l e d t o  In the determination  a strong  theory.  t o produce  be i d e n t i f i e d  a major  i n t h e Crow R a t e p o l i c y .  t h e "great-man"  narrow  as  i n transportation.  a change  for  recently  remained  that  existed  identifies  individuals  of transport  as  a  t h e Crow policy  Davey a r r i v e d on t h e scene. next  only  p o l i c y but i talso  a policy  that  i n Canada  any c o o r d i n a t i o n  transportation  Act,  over-  As a r e s u l t , t h e development  and t h e p r o v i n c e s  The  such  policy  ideology  component.  had  policy role.  transportation  railway  for  an e x p e n s i v e  department  t o demonstrate  department  transportation  and  with  of the federal  was d e s c r i b e d  1970,  of  railways  system.  The (DOT)  national  case  of  c a n be made  Also  discussed  Conference  of  1973  freight  rate issues  chapter  examines  provincial support fact  was and  that  the  notion  there  contrast  is  a  not  be  The  The  both  federal be  to the  made  through a  Crow  Rate  federal that  chooses be  until  disprove  shaping  transport  federal  and  they  a  to  a crucial  the  remain  when As  and  joint  issue.  free  choose  result,  change  in  issue  of  criticize  but  national  the the  on  a  federal  t a k e n by  whenever  the the  opposite federal  policy, provincial  factor.  1960s, policy  the  were  most the  p r o v i n c i a l governments  federal  to  by-  levels,  the  positions  of  held  the  third,  to The  number  perceptions  Second,  basis  and  discrimination.  p r o v i n c i a l and  provinces  occurs.  s u p p o r t can  the  conference.  leads  facts.  government  government  of  that  substantiated  the  rate/movement  provinces.  Up  the  rate  between  government i s r e l u c t a n t t o  rarely  to  r a t e d i s c r i m i n a t i o n b r e a k s down when e x a m i n e d  specific  federal  devoted  case could  to  the  Opportunities  was  of  relevant  gap  the  of  a valid  studies  both at  with  out  freight  conclusions  politicians,  freight  that  of  federal-provincial  First,  attention  perception  a case could  interesting  Western Economic  emanating  politicians  the  the  government  - 165  to  -  important  conflicts and  the  develop  factors  between  the  unwillingness a  national  transportation or  plan.  Interest-group  to  only  facilitator  recent  years.  development, take 1970s  on  more  The as  change role  of  i s documented  importance  action  became  as  more  i n t h e Crow  and 1 9 8 0 s .  - 166 -  Rate  barrier  apparent  interest-groups i n the next  a  in  policy  chapter, debate  in  did  of the  NOTES  Page 1 of 6  Ijohn Schreiner, Transportation: The Evolution of Canada's Networks. McGraw-Hill Ryerson, Toronto, 1972, p. 1. 2  Wayne  3  John Schreiner, op. cit.. p. 1.  4  Gooding, "Steering A Course For World Markets", The Financial November 8, 1980.  J. J. Green, "Aeronautics-Highway Research Report. 1970.  Post.  to the Future", Science Council of Canada  ^Department of Transport. "Freedom to Move", A Framework for Transportation Reform (Green Paper), Department of Supply and Services, Ottawa, 1985, pp. 13-14. 6  lbid. p. 14.  ?John Schreiner, op. cit.. p. 27. 8john Schreiner, op. cit.. p. 27. ^Freedom to Move, p. 14. ^Gerald Friesen, The Canadian Prairies: Press, Toronto, 1984, p. 186. HH.  A History.  University of Toronto  A. Innis, A History of The Canadian Pacific Railway (first published in 1923), University of Toronto Press, Toronto, 1971, p. 294.  l^Vernon C. Fowke, The National Policy and the Wheat Economy. University of Toronto Press, Toronto, 1957, p. 59. 13Friesen, op. cit.. p. 187. l^Friesen,  op. cit.. p. 294.  15Friesen, op. cit.. pp. 189. l^Robert Chodos, The CPR - A Century of Corporate Welfare. James Lewis and Samuel Publishers, Toronto, 1973, p.2. 17  E. J. Pratt, Towards the Last Spike. MacMillan,  - 167 -  Toronto, 1952, p. 53.  NOTES  Page 2 of 6  ^Charles Dalfen and Lawrence Dunbar, "Transportation and Communications: The Constitution and the Canadian Economic Union in Case Studies in The Division of Powers, Mark Krasnick. Research Coordinator, Vol. 62, Roval Commission on the Economic Union and Development Prospects for Canada. University of Toronto Press, Toronto, 1985, p. 140. 19  20  Ibid. pp. 140.  Ibid. p. 140-141.  21  Ibid. p. 143.  22  23  Ibid. p. 152.  John  24  T.  Schreiner, op. cit.. p. 14. Glazebrook, A History of Transportation in Canada. McClelland and Stewart, Toronto, 1964; H. A. lnnis, A History of the Canadian Pacific Railway. University of Toronto Press, Toronto, 1971 and Pierre Berton, The National Dream: The Great Railway 1871-1881. McClelland and Stewart, Toronto, 1971.  ^Leslie  T. Fournier, Railway Nationalization 1935, p. 37.  in Canada. MacMillan,  Toronto,  &Robert Chodos, op. cit.. p. 3.  2  27  Atlas  28  29  of Saskatchewan, p. 17.  Ibid. p. 174.  Canada  Year Book. 1927, p. 528.  ^Michael Bliss, Northern Enterprise - Five Centuries of Canadian Business. McClelland and Stewart, Toronto, 1987, pp. 327-328. ^Leslie 32  Atlas  Leslie  33  T. Fournier, op. cit.. pp. 20 and 42. of Saskatchewan, p. 17. T. Fournier, op. cit. p. 32.  34Michael Bliss, op. cit.. p. 285.  - 168 -  NOTES  Page 3 of 6  35Royal Commission on Transportation. Queen's Printer, Ottawa, 1932, p. 21. 36  37  Ibid. p. 21.  Canada. Commission on Grain Handling and Rail, Supply and Services, 1976, p. 76, 79, 83.  Barry  Wilson, Beyond the Saskatoon, 1981, p. 130.  A..  W. Burges, "Attitudes Towards the Railways" in The Crow Book. (unpublished), edited by H. Ropertz, Department of Transport, Ottawa, 1982, p. 54.  38  39  ^Barry  Harvest.  Western  Producer  Prairie  Ottawa,  Books,  Wilson, op. cit.. p. 131.  4lHenry Ropertz, "You can Choose the Next Grain Handling and Transport System", Remarks to a Seminar on Grain Transportation Innovation. Western Canada Wheat Growers Association, November 15, 1985, Brandon Manitoba, p. 3. 42]iarry Wilson, Beyond the Harvest, p. 134. 43Barry Wilson, Beyond the Harvest, p. 134. 44]}arry Wilson, Beyond the Harvest, p. 135. 45Dal fen & Dunbar, op. cit.. p. 153. ^Ibid. p. 153. 4?John R. Baldwin, "Transportation Policy and Jurisdictional Public Administration. Vol. XVIII, 1975, p. 634. 48  IbM,  Issues, Canadian  p. 634,.  49John Schreiner, op. cit.. p. 59. 50WESTAC Newsletter. "Under Debate: The Framework Trucking", Vol. 12, No. 1, January, 1986, p.5.  for  Canadian  5^Howard Darling, "Transport in Canada; The struggle of Ideologies versus Realities" in Issues in Canadian Transport Policy, edited by K. W. Studnicki-Gizbert, McMillan, Toronto, 1974, p. 22.  - 169 -  NOTES  Page 4 of 6  5 F.W. Anderson, "The Philosophy of the MacPherson Commission" in Issues in Canadian Transport Policy, p. 50. 2  53Atlas of Saskatchewan, p. 175. 54John Schreiner, op. cit.. p. 70. 55Atlas of Saskatchewan, p. 175. 56canada Commission on Grain Handling and Transport, Vol. 1, pp. 76-80. 57John R. Baldwin, The Evolution of Transportation Policy in Canada - A Seminar Paper Presented to the Canadian Transport Commission, January, 1977, p. 1. 5&F.W. Anderson, "The Philosophy of the MacPherson Commission and The National Transportation Act", in Issues in Canadian Transport Policy. edited by K. W. Studwicki-Gizbert, MacMillan, Toronto, 1974, p. 53. 59John W. Longford, Transport in Transition: The Reorganization of the Federal Transport Portfolio. McGill - Queen's University Press, Montreal, 1976, p. 23. 60  61  Ibid. p. 24.  John  62  W. Longford, "The Making of Transport Policies - A Case Study; The Ministry of Transport as a Policy- Making Institution in Issues in Canadian Transport Policy, edited by K. W. Studwicki-Gizbert, MacMillan, Toronto, 1974, p. 408.  Ibid. pp. 409-413.  63Canada, Transportation Policy: A Framework for Transport Summary Report. Information Canada, Ottawa, June, 1975.  in Canada:  ^Trevor D. Heaver and James C. Neilson, "The Roles of Competition and Regulation in Transport Markets", Transportation Research Forum. Vol. XIX, No. 1, 1978, p. 598. ^5John R. Baldwin, "Transportation Policy and Jurisdictional Issues", Canadian Public Administration. Vol. 18, 1977, p. 631.  - 170 -  NOTES  66  67  Page 5 of 6  Ibid. p. 632.  John  W. Langford, "Summary", p. 576.  6 Martin Westmacott, "The National Transportation Act and Western Canada: A Case Study in Cooperative Federalism", Canadian Public Administration. Vol. 16, No. 3, 1973, p. 463. 8  69  Ibid, p. 456.  70  lbid,  71  Toronto Star, (Nov. 23, 25, 27, Dec. 2, 1971) Peter Debarats in a series of articles interviewed the three prairie Premiers. Quoted in Westmacott, "The National Transportation Act", pp. 466-467.  72  p. 456.  Western Premiers, "Economic and Industrial Development Opportunities - Joint Submission of the Western Premiers to the Western Economic Opportunities Conference", Calgary, July, 1973.  Alan  73  74  Tupper, "Mr. Trudeau and the West" in Western Separatism, edited by Larry Pratt and Garth Stevenson, Hurtig, Edmonton, 1981, p. 91.  Ibid, pp. 91-92  $Western Premiers, "Transportation Position Paper", Opportunities Conference, Calgary, 1973, p. 1.  7  76  Albert  Hansard, March 14, 1974, p. 183.  77  Albert  Hansard, October 23, 1974, p. 3135.  Western  Economic  The National CBC-TV News, September 28, 1974.  78  79  Henry  Ropertz, "Intergovernmental Cooperation in Transportation Policy", (The Marchand Formula), A Paper Presented to the Canadian Transportation Research Forum, Royal York Hotel, Toronto, November 3-5, 1975.  %0p. S. Ross & Partners, et al., Two Proposals for Rail Freight Pricing: Assessment of their Perspective Impact. A report to the Federal-Provincial Committee on Western Transportation, September 30, 1974.  - 171 -  NOTES  Page 6 of 6  BljV. W. Wilson, et ah, Roadbed Costs and Cost Relief Options for Canada's Contiguous Railways. A Report to the Federal-Provincial Committee on Webster Transportation, March 14, 1975. 82  Howard Darling, The Politics of Freight Rates, op. cit., and W. G. Waters, "Transportation, Pricing, Policies and Economic Development", Economic Council of Canada. Discussion Paper No. 234, 1984.  83  W.  84  8  Alan  G. Waters, op. cit.. p. 99. Tupper, "Mr. Trudeau and the West", p. 91.  $M. Westmacott & P. Dore, "Intergovernmental Cooperation in Western Canada", The Western Economic Opportunities Conference in Canadian Federalism, edited by J. Peter Meekison, op. cit.. p. 350.  86  Ibid. p. 350.  -  172 -  CHAPTER FOUR CROW RATE A S AN ISSUE  4.0  Introduction The  previous  chapter  national  transportation  framework  o f t h e changing  chapter  begins  special  of  emerging  analysis  longitudinal policy  period  between  to  this  change.  provincial  Rate  a ten-year  1980 a n d 1983. because g r a i n  and t h e r e  Whether  were  the rates  chapter  issue  provides  between  emphasis placed  of  within  the  of federalism.  This  policy  and w i t h i n t h e forces  and  pressures.  would impact d i r e c t l y on the  The  Canada  government  i n  of the federal  over  analysis  responsibility  structure  undertaken  study  reform  i n  transportation  i n t e r e s t group  The  policy  t h e development  t h e e x a m i n a t i o n o f t h e Crow R a t e w i t h i n t h e  framework o f n a t i o n a l context  discussed  this  chapter  government's  period  with  freight rates  a  t h e 1880s  itself  reasons f o r the  results  provinces.  historiography*  o f t h e Crow  a n d t h e 1980s w i t h  o n t h e Crow's N e s t P a s s  the  area federal  economic  prairie  Rate  on  lends  were changed o r n o t , three  Crow  emphasis  T h e Crow R a t e  strong  i s a  Agreement  specific of  1897.  *The term historiography is chosen rather than history because the chapter provides both a history and an analysis of the Crow Rate issue.  - 173 -  An  analysis  i s u n d e r t a k e n o f t h e changes  agreement.  This  i s a  critical  Crow R a t e r e f o r m a r g u e d t h a t ,  No the  attempt  Crow  over  Rate  t h e Crow  fact.  uncertainty);  to  history of  since  t h e debate  this  Rate  thesis  consistently  the period  demonstrates confused  attention  ideology  with  i s f o c u s e d o n two  b e t w e e n 1970 a n d 1980 ( p e r i o d o f  and, t h e p e r i o d  between  The l a t t e r  period  1980 a n d 1983  i s t h e major  (the  focus of  thesis.  The and  opponents  i s made t o p r o v i d e a d e f i n i t i v e  p e r i o d o f change). the  since  "a d e a l i s a d e a l " .  Therefore, considerable  time periods:  issue  over time t o that  second p a r t o f t h e c h a p t e r examines  intra-governmental debates  government railways  and t h e v a r i o u s  and t h e i n t e r - a c t i o n  interest  and t h e a g r i c u l t u r a l  both the i n t e r  groups  organizations  such  between as t h e  both i n western  Canada and Quebec.  4.1  Crow's R a t e On  Act* Crow's  June  Historiography  2 9 , 1897 t h e P a r l i a m e n t o f C a n a d a  t o authorize Nest  Pass  a  subsidy  from  for a  railway  Lethbridge,  Alberta  passed  an  through the to  Nelson,  *The Crow's Nest Pass Agreement and the Act of Parliament to Authorize a Subsidy for a Railway through the Crow's Nest Pass are contained in Appendices I and II respectively.  - 174 -  British  Columbia  Government Canadian  (330 m i l e s ) .  o f Canada  Pacific  railway.  to enter  also  $3.6  would  settlers'  million.  over  Company  to Fort  apparent, Canadian in  mistakes According  William in  moving and  this  to  a  over  Port  a subsidy of  the  agreement,  railway on  western  set of  a  forever list  Canada  lines.  of and  In addition, rates  the  to rate  to  move  toa l l  Pacific  As  will  lines become  decision  of  reductions  the  t o be  r a n k as one o f t h e more c o s t l y  business  MacPherson  Canadian  Arthur.  chapter,  Canadian  the  of  rates  Pacific  R a i l w a y t o agree  any  to  the  i n 1898 and 1899 and n e v e r t o  f o rperpetuity w i l l of  with  The r a t e s w e r e t o be i n e f f e c t  products  Pacific  effect  eastern  determined  later  receive  part  general  to establish  charge higher rates.  east  the  from  agreed  grain  As  a l l Canadian  at levels  listed  an A g r e e m e n t  o p e r a t e t h e 330 m i l e  reduce  effects  transported  grain  into  enabled the  R a i l w a y Company w h i c h was t o c o n s t r u c t t h e  Canadian P a c i f i c would  the  Act also  I n r e t u r n , t h e R a i l w a y would  approximately  and  The  i n Canada's  Commission,  l o s i n g money m o v i n g g r a i n i n 1958 and l o s t  CP  history.  Rail  began  money e v e r y y e a r  t h e r e a f t e r t o 1983.  Pre-1897 To  attempt  a review of the historiography  Rate i s s u e i s a d i f f i c u l t  assignment.  - 175 -  o f t h e Crow  For years some prairie politicians have ' c a m p a i g n e d on t h e Crow.' Sometimes i g n o r i n g other issues, behaving like fundamentalist ministers at a r e v i v a l meeting, they have preached to the gospel o f t h e Crow. Some farmers believed that t h e Crow Rate was e s s e n t i a l t o t h e i r e c o n o m i c s u r v i v a l as was the good life to the s a l v a t i o n of their soul. S u c h f e e l i n g s w e r e w i d e s p r e a d and t h e y were deep 1  E i n s t e i n had an e p i t a p h with to  issues  search  conceal  t h a t comes t o m i n d when d e a l i n g  t h a t have been d i s t o r t e d o v e r f o r the t r u t h also  any p a r t  implies  freight  federal and  rate  government  and  Canada  Canadian  1885,  a  years!  Pacific  such  gasoline  Ironically, Railway  driven  must  true,"  relations  had  less  and the  Manitoba  These  issues  scene i n western  than  reached  velocipede  not  2  between  as O n t a r i o ,  t o predominate the p o l i t i c a l  f o r 100  right  railway construction  dominated  provinces  One  B r i t i s h Columbia i n the l a t e 19th Century.  would continue  the  issues  "The  a duty.  o f what one h a s f o u n d t o be  As i n d i c a t e d i n C h a p t e r t h r e e , rail  time.  built  a year  the at  after  Pacific the  in Benz  f a c t o r y i n Germany l e d t o t h e b i r t h o f t h e a u t o m o b i l e .  Canada's witness  pre-occupation the  emphasis  with on  railways  railway  issues  over n a t i o n a l t r a n s p o r t a t i o n p o l i c y .  - 176 -  still  exists  during  the  today, debate  In access  1871, t h e concern  forBritish  t o t h e r e s t o f Canada.  a condition of Confederation result with a  the federal  railway  terminus  line of  agreement  existing  granted  (eventually prairies),  the  t o be  selected  $25 m i l l i o n  profits  The  monopoly  topped  25  (CPR)to  construct  and  the  CPR w o u l d  1980s. of  4  since  Farmers  as b e i n g  overly  not require  Union  such  as  Pierre  i n the 713 m i l e s Some  granted  until  3  the benefits  by o r g a n i z a t i o n s  and t h e G o v e r n m e n t o f  generous  relief  land  dollars.  also  i s important  The  of  land  and some  were  from  However, even a p o p u l a r i z e d  t h e CPR,  acres  10 p e r c e n t o f t h e i n v e s t m e n t .  as t h e N a t i o n a l  Saskatchewan  Vancouver.  available  b e s t o w e d u p o n t h e CPR h a v e b e e n i d e n t i f i e d such  ( t h e western  a t $38 m i l l i o n  privileges  and a s a agreement  Ontario  d o l l a r s i n cash  1881 Agreement  rail  an  million  from  valued  into  Company  lines)  CPR  Columbia*  entered  Sudbury,  rail  o f p u b l i c l y owned l i n e additional  for British  Railway  between  was  A r a i l w a y t o t h e P a c i f i c was  government  t h e Canadian P a c i f i c  Columbians  t o t h e degree  t h e Crow R a t e  version  Berton's  that  i n the  of the building  The National  Dream^,  o u t l i n e s t h e s i t u a t i o n w h e r e a l l c o m p e t i n g r a i l w a y s demanded more c o n c e s s i o n s  than were e v e n t u a l l y  granted  t o t h e CPR i n  *The Crown Colony of British Columbia joined Canada on July 20, 1871 on condition that a railway linking eastern Canada with the Pacific Coast would be constructed by 1881.  -  Ill -  1881. of  A c c o r d i n g t o V e r n o n Fowke i n a P r e s e n t a t i o n on  the  Government  of  Saskatchewan  C o m m i s s i o n on T r a n s p o r t a t i o n i n  to  the  behalf  MacPherson  Royal  1960:  "...the purpose which rendered its organization necessary were national purposes, of extraordinary import and exceptionally d i f f i c u l t of attainment. The p r i c e to the Canadian people f o r assurance of s u c c e s s was l i t t l e e n o u g h i n c o m p a r i s o n w i t h the c e r t a i n c o s t of f a i l u r e . " 6  A 1978  brochure identifies  million  dollars  designed  the  1961,  question  that  a  railway.  myth  or  of in  Alberta  25  million  the  context  MacPherson  benefits  I t reported:  donor  the  link  completed both killed  in  the  should  "We  find  receiver  between  i n 1885. dollars  acres they  Commission be  Pool  in  and  25  were  no  evidence  contemplated  Sudbury  I t was and  accidentally  during  and  (at the  - 178  at  least  operate that  such  was  the  either action.  in  fact  an  enormous  cost  62  Chinese  were  c o n s t r u c t i o n of  -  the  8  Vancouver  completed  humans  to  not  7  examined  used  G r a n t s w e r e made t o g e t t h e r a i l w a y b u i l t . "  The  Wheat  the r a i l w a y s continued o p e r a t i o n .  the the  by  grants  as  to support  In  the  published  the  line  through who  lost  that to  t h e Rocky and C o a s t m o u n t a i n their  lives  have  never  ranges).  received  While  those  the recognition  was b e s t o w e d o n t h e V a n H o m e s a n d S t e p h e n s * , o n e h a s  accept  that  the line  was s u c c e s s f u l l y  completed  due t o  the:  . . . e n g i n e e r i n g e x p e r t i s e , d r i v e , f o r e s i g h t and business acumen s o a b l y demonstrated by t h e management o f t h e company. T h e company was therefore i n a position to benefit from any further i n i t i a t i v e s o f t h e f e d e r a l government toward using transportation to accomplish national objectives. 9  That  situation  was  soon  interim,  i n 1888 t h e f e d e r a l  monopoly  clause  sweetened interest of  bonds.  Also,  unreasonable rates  on g r a i n  develop  by  providing  Pacific t h e CPR  on a f o r t h - c o m i n g i n response  freight  rates,  but, i n the  government  i n t h e Canadian  the p i l l guarantee  to  issue  ( s e e Figure 4: Grain and Flour Export  the  Charter  but  with  a  loan  o f $15 m i l l i o n  to allegations t h e CPR b e g a n  repeated  of charging t o lower i t s  Rates).  * William Van Home, an American, was in charge of construction. George Stephen was a Scottish financier who negotiated the 1881 Agreement with Canada to construct the railway.  - 179 -  The  Crow's  Parliament Canadian in  Nest  Pass  authorizing Pacific  t h e 1890s  Agreement  t h e payment  Railway  arose  i n t h e Kootenay  and  the A c t of  of subsidies  out o f events region  to the  taking  of southern  place  British  Columbia.  This attracted  area  Railway  Railway  a branchline 1893.  viewed  Nelson,  sovereignty."  alarm  Pass  of this  as  Conservative the  cost  Alberta  was t h e  who was a member  a bid to build the  succeeded  Columbia branch  and  from Spokane i n  line  one  with  such  an  infringement  i n building  into  an  potential, on  area was  Canadian  1 0  Canadian  Rail  entered Hill  Pacific  Railway  Dunsmore J u n c t i o n t o L e t h b r i d g e Nest  i n minerals  T h e most n o t a b l e  British  particularly  with  The  that  t o Vancouver.  into  rich  owned b y J i m H i l l ,  "The p e n e t r a t i o n  Canada,  t o be  interest.  one o f t h e s y n d i c a t e s  Pacific  of  known  considerable  Great Northern of  was  Lines)  and  Government  and N e l s o n ,  i n 1882 ( s e e  began  i n Ottawa  of construction  of a  British  had l e a s e d  f o r a subsidy line  - 180 -  from  Map No. 1 Crow's  negotiating  Columbia,  miles.  a line  between  with  the  to  cover  Lethbridge,  a distance  o f 330  The picture  Government when  i t issued  Southern Railway Nelson.  of  The  British  the  Lethbridge  and N e l s o n  subsidy  question  them  a  arises  monopoly  Northern  Railway  on t h e Columbia  refineries  also  rail  Columbia  began  link  the mineral  as  t o why short  to  between  ores  position?  time,  t h e CPR was  hefty  subsidy  Freight  through  of the  rate  in  CPR  to  and  concessions government  i n 1897  - 181 -  offer  to  A t t h e same  and r e q u i r e d  a  .  were  concessions i n grain f r e i g h t rates  Hill's  buy mines  finally  difficulty  Kootenay  Michael  t o run steamship  t h e Crow's N e s t P a s s .  1 1  a  would  from  and t h e O k a n a g a n L a k e s ,  i n financial  the  which  competition  I t i s i n t e r e s t i n g t o note  interest  link  required  According  forced  to b u i l d the l i n e .  the Laurier  subsidy.  which  t h e CPR rail  i n the Kootenays,  a railway  lost  to prevent  a relatively  build  offer  a  t h e CPR was f a c i n g m o u n t i n g  service and  of  the  b e t w e e n P e n t i c t o n and  government  construction  to build  Bliss, Great  to the B r i t i s h  a line  Columbia  had e n t e r e d  f l o w i n g down t o S p o k a n e .  The  give  Columbia  a Charter  to construct  encourage  region  British  a l l that  CPR  i n return that  region  f o r the  Jim H i l l but  could  the  remained i n e f f e c t .  soon CPR's  FIGURE 4 :  (TRAIN AWD FLOUR K*POPT RATES REGINA TO THUNDER BAY Y777 MILES)  (< per 100 lbs.) 40  War Measures Act  30  ^  20 Crow Agreement 1897  To 1982  Rate Made Statutory  Manitoba Agreement  10  1884  1  1890  ±  1900  1910  J 1920  1930  (year)  Source:  Extracted from An Historical Analysis of Railway Export Graint Rates and to the Crow's Nest Pass Agreement of September 6,1897 by Joseph C. R. Hanley, 1980.  - 182 -  Map No. 1: Crow's Nest Pass Railway  Legend Not t o S c a l e eeo - P r o p o s e d C r o w ' s N e s t P a s s R a i l w a y CPR - C a n a d i a n Pacific Railway t o Port c o m p l e t e d i n 1895.  Moody, B.C.'  *The Crow's Nest Pass Railway was completed in the autumn of 1898 to the south end of Kootenay Lake and from that point steamers and barges carried carloads of the freight unbroken to Nelson. The Great Northern Railway reached Nelson in 1895.  - 183 -  It  i s also  analysis  interesting  o f t h e Crow  Rate  former E x e c u t i v e D i r e c t o r of  t h e Canadian  t o note that i n a comprehensive Agreement,  by t h e  o f t h e R a i l w a y T r a n s p o r t Committee  T r a n s p o r t Commission,  a passage a t t r i b u t e d  undertaken  to Sifton  Joe H a n l e y ,  by John Dafoe  1 2  quotes  i n Clifford  Sifton  in Relation to his Times:  "...I remember as a young Minister in Laurier's c a b i n e t , Van H o m e and Shaughnessy s a i d a l i n e i n t o t h e Kootenay mining d i s t r i c t w o u l d n o t be c o n s i d e r e d f o r f i f t e e n y e a r s . A l s o I remember t h a t w i t h i n s i x weeks t h e same two g e n t l e m e n came i n t o my o f f i c e and s a i d t h e y h a d t o b u i l d t h i s l i n e and w a n t e d a l a r g e b o n u s f o r d o i n g i t . . . w e g a v e them t h i s bonus...They b u i l t t h e l i n e " . 1 3  A Dafoe  review of the f u l l  passage  attributed  to Sifton  by  i s as f o l l o w s :  "...we gave them t h e bonus (against the public sentiment of two-thirds of the people i n Canada). They b u i l t t h e l i n e (and K o o t e n a y m i n i n g d e v e l o p m e n t s a v e d t h e CPR a n d s a v e d a g o o d many o t h e r t h i n g s i n C a n a d a . " ) 1 4  Certainly CPR  allowed  contained  there  itself  a fixed  i s no s i n g l e t o be  level  part  of freight  - 184 -  a n s w e r ' as  of  an  t o why t h e  agreement  which  rates. . But h i s t o r i a n  Michael days  Bliss  for  states  the  that  Railways  they u l t i m a t e l y believed  As  was  to  reasons  negotiated.  and  These  common p r a c t i s e  accept  rate  c o s t s would  r e f l e c t e d i n the  a number o f  i t was  objectives  ceilings,  fall.  Crow R a t e  in  1  those  because  5  Agreement  as t o why  there  the  were  agreement  included:  1.  the r a p i d economic e x p l o i t a t i o n of of the Kootenay r e g i o n ;  2.  the e f f e c t i v e i n t e g r a t i o n of t h i s r e g i o n i n t o economic mainstream of Canada rather than United States;  3.  the s t i m u l a t i o n of a g r i c u l t u r a l settlement on the p r a i r i e s by means o f f i x e d f r e i g h t r a t e s on g r a i n and l o w e r r a t e s on w e s t b o u n d s e t t l e r s ' e f f e c t s ;  4.  t h e g r a n t i n g t o t h e CPR o f a m o n o p o l y p o s i t i o n i n the Kootenay r e g i o n which i n c r e a s e d i n importance when t h e CPR t o o k o v e r t h e s m e l t e r a t T r a i l .  There provide the  varied  Crow  analysis  exists  degree  objectives.  considerable  support  Rate  whether the what  is  which  literature  f o r the  Agreement.  the  provides  a  little  point  of  The  Crow R a t e A g r e e m e n t was analysis  that  - 185  is  -  behind  historical view  as  to  or  to  met  a factor  available  the the  which  reasons  above r e a s o n s were e i t h e r e v e n t u a l l y the  ores  available  above l i s t e d However  mineral  is  in of  these the  contemporary until  nature.  the late  This  1950s,  i s probably  t h e Crow  Rate  the case  was  because  never  really  a  p r o b l e m t o e i t h e r t h e g r a i n s h i p p e r o r t h e CPR.  The rate  first  level  cents  per  1899,  itself. 100  decrease  response  that  The  pounds,  was s m a l l  cent  area  to public  demand)  year price  was  signed  level  Canada's h i s t o r y ,  although -  on  during  national  of  three  i n 1898 and 30 p e r  to  the  Canadian  b y some 35 p e r c e n t .  t h e terms  were  It  unaware  of  boom i n  of trade  shifted  1 6  debate often  i n t h e 1980s cited  proponents  t h e economic  boom  o f t h e Crow R a t e A g r e e m e n t a s a  Canada,  should  t o 1897  s i g n e d a t t h e end  which  the parties  which  the signing  benefit  prior  t h e eve o f t h e g r e a t e s t  t h e Crow R a t e  followed  was  during  had f a l l e n  "no c h a n g e t o t h e r a t e s "  which  effect  i s the  the approximate  Agreement  i n Canada's f a v o u r .  During of  -  at the time  radically  into  decrease  i n the years  depression  wholesale  this  rate  examined  i n t h e r a t e s made b y t h e CPR v o l u n t a r i l y ( i n  of  also  t o be  i n comparison w i t h  The Crow R a t e  23  actual  t o come  (Figure 4). a  needs  never  and  therefore  grain  producer  have  burden  t o move h i s p r o d u c t t o m a r k e t .  - 186 -  to  pay  the an  prairie increased  I n 1940, t h e R o y a l Commission Relations featured growth 200  examined a  million  i n wheat  million  interest  the period new  rates,  from  million  The  British  major  rail  20  the prairies  and  a  bushels t o over  Commission  concluded  that  low  investor  interest  and  the  freight rates,  freight rates  rather  than the  on g r a i n , were t h e  reasons f o r t h e growth of western C a n a d a .  4.1.1  1 7  P e r i o d t h e C r o w ' s N e s t P a s s R a t e s Were i n E f f e c t  As Nest  of f i x e d  1896 and 1913 w h i c h  on  phenomenal d e c l i n e i n ocean existence  between  Dominion-Provincial  settlers  exports  bushels.  on  Pass  during  already Rates  much  statutory  discussed for grain  the rates  were  Rate  structure  on  As  t h e y were  illustrated  actually the  Three,  lower.  thirteen  reappearance  f o r three  i n Figure 4  westbound  months  rates  superceded  However,  f r o m 1897 t o 1 9 1 8 , some 21 y e a r s ,  restricted  t h e Crow's  not the a p p l i c a b l e  before  i n 1925.  188),  lasted  were  of the period  rates  i n Chapter  by  (Page  t h e Crow  commodities  and made  a  brief  i n 1924  and f o r  about s e v e n months i n 1925.  The the  eyes  described  effect of  of the rates  prairie  however,  producers.  b y M c D o u g a l l as f o l l o w s :  - 187 -  The  loomed  situation  large i n has  been  The r a t e r e d u c t i o n s o f 1898-99 ( C r o w ' s N e s t R a t e s ) happened t o coincide with a major a d v a n c e i n t h e f o r t u n e s o f t h e p r a i r i e West. T h e y came when y i e l d s p e r a c r e , a n d p r i c e s per bushel, were both rising f o r other reasons and t h e y r e i n f o r c e d these trends. Under a l l these s t i m u l i , acreage expanded rapidly. The r e s u l t i n g c a p i t a l i n v e s t m e n t i n new f a r m s , a n d i n t h e a d d i t i o n a l railroad m i l e a g e a n d new towns t o s e r v e them, b r o u g h t t h e c o u n t r y o u t o f t h e d o l d r u m s o f t h e 1890s f i r s t i n t o p r o s p e r i t y and u l t i m a t e l y i n t o t h e b i g g e s t boom b e t w e e n t h e 1850s and t h e 1 9 5 0 s . The r e s u l t o f t h i s r e m a r k a b l e d e v e l o p m e n t was t o c r e a t e a m y s t i q u e i n w h i c h t h e Crow's N e s t R a t e s became t h e f o u n t o f a l l good t h i n g s and the foundation of agricultural prosperity. T h i s post hoc, ergo propter hoc a r g u m e n t * a t t r i b u t e s t o t h e Crow's N e s t R a t e s a l l t h e c o n s e q u e n c e s of r i s i n g g r a i n p r i c e s i n western Europe, o f b e t t e r t i l l a g e and o f ample r a i n f a l l a t home. Up t o 1914 t h e Crow's N e s t R a t e s o n g r a i n w e r e good development rates, good for the r a i l w a y s a n d good f o r s h i p p e r s ; thereafter they were an anachronism. The p r i m a r y d e v e l o p m e n t h a d been a c c o m p l i s h e d a n d i t was t i m e t o i n c o r p o r a t e them i n t o t h e g e n e r a l r a t e s t r u c t u r e a n d t o b r i n g them w i t h i n t h e jurisdiction o f t h e Board of Transport Commissioners. 1 8  It  i s almost academic  impact  o f t h e Crow  Canada  since  Rates  the rates  t o engage t h e q u e s t i o n on t h e economic  allowed  f o r under  Agreement were h a r d l y ever i n e f f e c t  of the  development o f t h e Crow  Rate  ( s e e Figure 4).  *post hoc, ergo propter hoc means after this, therefore on account of this. (Fallacy Argument)  - 188 -  More which the  were  almost  than  always  1918,  expenses World  resulting  from  wages  t o Canadian  were  under  increased  August  12, 1918.  higher  the conditions  were  operating  o f t h e 1914-1918  employees  -  t h e Canadian  Order-in-Council  and s c a l e  pursuant freight  1863,  Order-in-Council  effective  This  19  time,  to  rates  was p a s s e d  1914.  of e s t a b l i s h i n g , f o r the f i r s t  under  had t h e  rates  on a  Act  under  b a s i s t h a n t h e Crow R a t e s c a l e .  provisions which  scale,  o f t h e McAdoo A w a r d  1768 -  rates,  itself.  Railway  This  Subsequently  in  t h e Crow's N e s t  a period of three  as  July,  o f t h e Railway Act  allowed  The and  t h e Crow R a t e  a u t h o r i t y o f t h e War Measures Act,  result  published  of greatly increased  War a n d t h e a d o p t i o n  P.C.  for  below  as a r e s u l t  Order-in-Council  the  the actual  a l t e r a t i o n s t o t h e Agreement  In  of  important  three such  years.  year  the  of  the early  One  of King's  1920s  a  Special  (Section 325:5) was e s t a b l i s h e d Agreement  t o be  disregarded  2 0  p e r i o d was d u e t o e n d i n J u l y , 1922  issue  d i s c u s s i o n s on f r e i g h t  1919  became  part  of  the  overall  r a t e s which dominated t h e Parliament  under  Prime  M i n i s t e r Mackenzie  King.  p r o b l e m s was p l a c a t i n g t h e P r o g r e s s i v e  Party  - 189 -  which  had  election the  scored  major  on t h e p r a i r i e s ,  economy  had slowed  were d e p r e s s e d . the  a  victory when  i n t h e 1921 g e n e r a l  i t won 65 s e a t s .  and t h e g r a i n  During t h e debate  June,  1922 t h e Railway Act  (1919) was  t h e Crow R a t e  of  6, 1 9 2 2 . The s u s p e n s i o n s w e r e  bound t r a f f i c  4.1.2  on  On  July  the  13  189 7  2 7 , 1924 t h e r a i l w a y s  Canadian  Changes  National  applications competitive  commodities  t o t h o s e CPR p o i n t s  ( s e e Table 9:  to with  and f l o u r as  c o n t i n u e d on w e s t J u l y 7, 1 9 2 4 .  to  the  points  t h e CPR.  but  Board  2 1  Crow Rate (CNR) on  t h e Crow R a t e s  restricted  and l i n e s  Railway  those  restored  Agreement) . restricted  i t s lines  The r e s u l t  not only  rejected  turn attempted t o r e i n s t a t e  their  i n existence i n  that  was c h a o s  B o a r d o f R a i l w a y C o m m i s s i o n e r s was f l o o d e d w i t h The  amended t o  o f Crow's N e s t P a s s R a t e s b y S t a t u t o r y  westbound  application  on e x p o r t g r a i n  f r o m E a s t e r n Canada u n t i l  Replacement Rates  t o have  shelved.  restore July  Rates  and p r i c e s  t h e CPR s o u g h t  Crow R a t e A g r e e m e n t p e r m a n e n t l y  In  market  I n 1922  The i t s were  and t h e  complaints.  the complaints but also i n  the higher  - 190 -  rates  previously i n  effect. no  On a p p e a l ,  power  was that lines  t h e Supreme C o u r t  t o change  returned  rates  fixed  t o t h e government.  t h e Crow  Rates  i nexistence  Table 9 :  could  only  ruled  t h e Board had  by s t a t u t e .  2 2  T h e Supreme be a p p l i e d  The i s s u e Court  held  t o t h o s e CPR  i n 1897.  C h a n g e s t o t h e Crow R a t e A g r e e m e n t  1897  1  1925  2  1983-  Railroads Miles  of R a i l  3,000  6,000  17,000  289  1,600  1,100  Volume o f G r a i n (M o f B u s h e l s )  24  340  1,250  Number o f P r o d u c t s Eligible  11  45  60  Delivery  line  Points  ICrow Rate Agreement Crow Rate Structure under the Railway Act ^Western Grain Transportation Act * Grain moved by the British Columbia Railway assistance in 1983. 2  - 191 -  for export  became eligible  for  The p r a i r i e p r o v i n c e s , General  i n Council  Agreement  sought  reinstated.  commodities  i n a petition t o have  Given  that  the entire  i . e . , the settlers*  effects  i n W i n n i p e g , i t made no s e n s e  urge  subsidy  goods  available  have  been  to  make  Toronto  i n Winnipeg.  aware  of  this  for  o f what  fear  grain  prairie  now  being  competitive  prairie  provinces  but  were  would  have  with must  probably  to the original  precedent  the pressure  provincial  Gardiner,  who  was  powerful  regional  Minister  Mackenzie  convinced  original or  a  westbound  agreement on  future  rates.  Despite  not  such  Rate  f o r the prairies to  situation  t o s u p p o r t any change  were  goods  The  unwilling  Crow  the thirteen  produced a  t o the Governor-  form,  t o Canada.  being  brought  governments, eventually  ministers King  one  t o become  i n Canada  (as discussed  that  a  return  would  be b e n e f i c i a l  In a letter  to  t o bear  by t h e  Premier,  James  one o f t h e most  under  Liberal  i n C h a p t e r t w o ) was  Crow  Rates,  either  t o t h e Prime  in  their  to the prairies Minister  i n 1925  he w r o t e : "I am inclined t o agree that the rates p r o v i d e d f o r i n t h e Crow's N e s t A g r e e m e n t a r e so f a r o u t o f d a t e as t o w a r r a n t t h e d r a w i n g up o f a new s c h e d u l e . . . s o g r e a t a c h a n g e h a s t a k e n p l a c e i n t h e c o m p a r a t i v e volume o f e a s t and w e s t t r a f f i c o n c e r t a i n c o m m o d i t i e s , s u c h as a p p l e s a n d c a t t l e ; a n d t h e r e h a s d e v e l o p e d  - 192 -  Prime  t h e new e l e m e n t i n t h e g r e a t v o l u m e o f w h e a t which i s being shipped to Vancouver; that i t w o u l d be i d l e t o t h i n k t h a t t h e C r o w ' s N e s t Agreement could be re-established and retained in i t s present form f o r anyconsiderable length of t i m e " . 2 3  In Court  i t s decision  held  applied  that  only  Rather  to  than  to  amend  indefinitely continued  The  Crow  Rates  to  offer  Fort  no As  any  of  the  level  At grain  was  1923-24 major  t o be  benefits  commit  grain the  t h e CNR  and  be  were  covered.  t o westbound  was  to  flour  amendment a l l  now  even though  itself  to  legislation  applied  related  1897.  Pass Agreement but  on  i n perpetuity  Agreement nor d i d i t ever fixed  Nest  Under  a result  in  be  legislation  This  a l l railroads  longer  could  approved  1919.  William. on  Rates  Supreme  discrepancies  structure  shipments  effects".  rate  of  the  i n existence  t h e Crow's  t h e Crow R a t e  received  lines  Act  1925  Pass  subsequently  Rate  were  16,  Nest  freight  Crow  grain  "settlers'  CPR  Railway  through  eastbound  those  suspended  the  shipped  Crow's  Parliament the  February  the  allow  perpetuated,  on  the  obliged i t never  Crow  Rate  t o move g r a i n a t a  forever.  the time shipped  o f t h e Crow out through  the P a c i f i c  export  port  terminal.  Rate Agreement Fort  William,  of Vancouver  By  Ontario.  b e g a n t o become  1930-31 o n e - t h i r d  - 193 -  a l l export  of  By a  a l l bulk  grain  exports  statutory 1927* in  went  rate  out of Vancouver.  structure  and s u b s e q u e n t l y  1931.  structure  There  were  itself  till  was a p p l i e d  no  further  grain  Board set  products.  of Railway  their  level  of  domestic  changes  western However have Grain  t h e Crow  subsidies  the  eastward  and s t i l l  rate  grain  I n 1954 t h e  regard  Thus, of  beyond  as f e e d  of  tothe  since  1954,  grain  within  Thunder  Bay.  i n w e s t e r n Canada  a r e i n t h e form  of  Feed  I m p l i c a t i o n s o f t h e 1897 A g r e e m e n t  between  proceeding  1970 a n d 1980 -  handling  recognize  many  to  the railways to  without  f o r movements  f o r g r a i n used  available  Before  to  Churchill  t i m e t o become  Structure.  and t h o s e  ports i n  Assistance.  4.1.3  grain  applied  Canada  been  Rate  the  the definition  authorized grain  result  of  T h e r e was o n e e x c e p t i o n .  on d o m e s t i c  rates  port  1983 a l t h o u g h  Commissioners  rates  a  to Pacific  t o the Manitoba  g r a i n was c o n s i s t e n t l y b r o a d e n e d o v e r and  As  an  the context to  analysis  a decade  and t r a n s p o r t a t i o n  alterations  rendered i t  to  of  the  of uncertainty  sector  agreement  in  the  - i t i s essential  o f t h e 1897 a g r e e m e n t  that  period  which  with the eventually  obsolete.  *The decision to extend the Crow Rate to Pacific Ports and Churchill was taken by the Board of Railway Commissioners under the Railway Act of 1919 which provided the Board with unlimited powers to set rates.  - 194 -  During argument  t h e Crow  was made  Rate  that  debate  t h e CPR  i n t h e 1980s,  agreed  the  i n 1897 t o move  g r a i n a t l e v e l s s e t i n 1898 and 1899 i n p e r p e t u i t y .  The provide As  such  shown  between and  Supreme C o u r t service  i n Tables  ruled  on r a i l  that lines  t h e CPR h a d o n l y i n existence  9 and 1 0 , c o n d i t i o n s  1897 a n d 1925 when t h e r a t e s  between  1925  and  1983  when  in  changed  w e r e made  the  to  1897.  greatly statutory  Western  new  Grain  Transportation Act was p a s s e d .  It expected as  i s difficult t o adhere  extensively  t o determine  how t h e CPR c o u l d  t o an a g r e e m e n t w h i c h  a s h a d t h e Crow  Rate  had been  be  altered  Agreement.  A l l the  c h a n g e s w e r e made i n t h e i n t e r e s t o f t h e w h e a t economy o f western Chodos,  Canada.  However,  t h e Crow R a t e  to  writers  Agreement  o v e r a l l CPR s t r a t e g y t o d e v e l o p expense should the  o f t h e Canadian be e x p e c t e d  movement  maintained", always  of grain. Chodos  considered  beneficiary of that would  was j u s t a large  taxpayer,  to sustain  such  Robert  one p a r t  ofthe  corporation  and a s  any l o s s e s  " I f t h e wheat  wrote  as  such  that  economy  at l e a s t share i n t h e cost  people  have  corporate  Pacific  of maintaining  - 195 -  i s t o be  the chief  economy, t h e C a n a d i a n  t h e CPR  i t incurred i n  i n 1 9 7 3 , "some  i t reasonable  at the  Railway,  i t " .  2  4  Table  10:  Grain Export  V o l u m e and P r i c e  SELECTED YEARS 1883-1985  Exports  Crop Year 1882-1883  6.0  1898-1899  24 . 6  (M)  Price Per : 1.08 .93  1924-1925  346.5  1.51  1932-1933  207.0  .54  1945-1946  342.9  1.25  1960-1961  277.3  1.67  1970-1971  504.0  1.67  1980-1981  700.0  6.16  1981-1982  775.0  5.52  1982-1983  875.0  5.33  1983-1984  807.2  5.36  1984-1985  756.0  5.16  Source:  (1) (2) (3)  Historical Statistics of Canada 1965 Canadian Wheat Board Annual Reports (1984-85) Canadian Grain Commission Annual Reports. (1945-46 to 1984-85)  -  196 -  Chodos that  in  effect  i s beyond  evident  of  i n Chapter  Five,  t h e Crow R a t e s  structure  was  over  producers. punished  that  of  suppressing  the  CPR,  development  as  large  implications.  to  speculate  that  early twentieth  of ' the century.  predict  the  increase  bushels  to over a b i l l i o n  i t was economic  Crow  Rate  of s t r e s s i n g prairie  grain) which  Rate  grain  is  to  is  the  result  in  production  established regard  o f t h e CPR  no  Prairies I t would  i n grain  and  the on  for  - 197  one that have  t o commit  -  The  an  longi t is itself  However, i t i s f a i r could  foresee  took  place  been  impossible  production  bushels.  be  through  chronicles  apparent  i n 1897  not  products.  i n perpetuity.  back  as  t h e wisdom o f h i n d s i g h t  the strategy  f i x e d f r e i g h t rates  the  livestock  Crow  without  Rail  of  become  changed  corporation,  Policy  Through  to  growth  the  will  example  rates  of  position  sounder  by  of a g r i c u l t u r a l  of  a  moving  freight  basis  easy to question  As were  interests  loss  Canada.  ad hoc  expedient,  dramatic  a  development  of  to  is a classic  fixed  history  lead  long-term  secondary processing  The  thesis.  hindered  ( s u s t a i n economic  maintenance  term  fact  This  the  The  would  in  itself.  ideology  Marxist  a d d i t i o n a l r e v e n u e t o CP  changes  which  this  a  scope  effect  base,  advocating  the  so much t o p r o v i d e to  was  from  world  24 of  in  the the to  million 1897  was  one  of  relatively  prices.  No  one  long  could  periods foresee  of  growth  and  decline  t h e huge b o u t s o f  w h i c h C a n a d i a n s h a d become a c c u s t o m e d t o s i n c e the  1939-45 W o r l d  As w i l l call  inflation  t h e end  of  War.  become e v i d e n t  for a  in  change  i n the following  i n the  Crow  Rate  was  sections,  not  so  the  much  an  attempt to r e l i e v e the burden of the f i x e d r a t e from e i t h e r CPR  or  honour to  even  the  CNR  which  was  forced  t h e Crow R a t e , as much as i t was  assist  the  economic  Chapter s i x discusses  how  development  by  Parliament  to  to effect  changes  western  Canada.  of  s u c c e s s f u l were  t h e changes  that  e v e n t u a l l y w e r e made.  4.2  Period  As regret a  indicated  (1960-1980)  i n the previous  strange  level  back  to note that  and d i d so w i t h  in  1897.  future.  1960s  the  The  Given  Parliament, emphasis  a p p l i e d on a l l e x i s t i n g l i n e s the  s e c t i o n , t h e CPR  i t s d e c i s i o n to agree to s e t g r a i n  fixed  path  of Uncertainty  f u t u r e was  implications  of  came t o  f r e i g h t rates  that  i n 1925,  example chose  at  i t is  a similar  i . e . , f i x e d r a t e s w e r e t o be and  a l llines  constructed  s l o w i n coming but by t h e this  serious.  - 198 -  decision  was  in late  becoming  The  railways  maintenance In  turn  miles the  or  to  they  of  to  purchase  advocated  of p r a i r i e part  refused  new  the  branchline.  the  grain  invest rolling  of  This  great  handling  caused  companies  line  progress  modernization 1960s  there  prairie  could  region  also to  sustain  This  valid  predictions  that  exports  improved  This  the  for  the  crop  concern could  section  analyzes  of  rail  with  their  own  During  the  late  c a p a b i l i t y of  a  crisis  the  events  i n the  f o l l o w i n g decade which  a  late  the  during  1980s,  believed  due  the  to  lost  billion  soil in  the  bushels  a  transportation.  sector  the  on  the  became  exceed  of  concern  which  yields  soon  grain.  thousands  status  program.  concern  erosions.  year with  not  (consolidation) was  for  abandonment  on  they  branchline  stock  t h a t w i t h o u t some f i r m d e c i s i o n s network  in  period  1960s and  in  which  which  provides  the  hit  the  grain  i n s i g h t on  those  directly  Crow  Rate  impacted was  on  finally  changed.  In  comparison  Agreement of with  the  1897  to  and  statutes  the of  subsequent  period  hectic.  indicated  As  the  period  transformation  Canada  up  to in  between  (Railway  1970  was  Chapter  - 199  -  2,  of Act)  the  Crow  that in  agreement 1925,  significantly the  topic  Rate  of  the less  freight  rates  had  question  not of  dissipated  the  freight  but  the  rate  f o c u s was  structure  on  and  the  broader  i t s impact  on  w e s t e r n Canada.  However, part  of  a  the  matter  larger  review  Commission  on  should  Crow R a t e s  The  the  of  grain in  1949  Transportation.  It  rates by  were the  Turgeon  addressed  remain under c o n t r o l  Commission reported  examined  the of  as  Royal  question, Parliament?  that:  . . . t h e r e a l i n t e n t i o n of amending t h e R a i l w a y Act in 1925...was t o put an end to the a g r e e m e n t o f 1897 as b e t w e e n t h e two p a r t i e s t o i t and to p r e s c r i b e instead a statutory stabilization of certain freight rates b i n d i n g on a l l r a i l w a y s . What was important was whether Parliament still looked upon western Canada's production of grain for export as an industry requiring special c o n s i d e r a t i o n i n the n a t i o n a l i n t e r e s t  The remain  Commission under  be  a decision  on  the  under  concluded  control  of  that  Parliament  for Parliament.  Crow R a t e s b u t  the  During  the  1950s  the  burden  of  the  Crow  Rates  should  and  any  change  should  Parliament  i s s u e d i d not  the  go  railways,  regulations  - 200  -  which  t o o k no  decision  away.  already dictated  operating freight  rate  levels  on  many  commodities,  situation  where t h e y e x p e r i e n c e d  costs  move g r a i n  to  1899  was  launched  presentation merits  of The  serious  study  concluded lose  in  1959-60  to  demonstrate  a  rate  set  money  a  operating  at  1898  and  to  1958  the  up  grain  determine  million  that  Rate  level.  In  be  losses  incurred.  undertook and  branchlines million  railways  concert  entitled  a  It  a  excess  also  detailed  the  in  were u n p r o f i t a b l e  and  per  were  annum.  losing  that  1958, cost  the  8,600  lost  the  Crow to  burden, railways them  for  miles  railways  of  the  p r o b l e m was  traffic  to  the  trucking  -  the  branchline  Part  - 201  but  Commission  the  the  not  and  MacPherson of  did  attempt  compensate  examination  that,  at  regulation  to  and  railways  overall  recommended  first  rail  level  the  The  the  by  grain  its  major  Chapter  probably  Rate  i n 1958,  subsidy  was  reported  Crow  with  from  to  grain  transporting  Commission  should  the  in  undertook  railways  a  grain.  discussed  moving  that,  year  railways  MacPherson  system  at  made  moving  Commission of  moving  the  were  cost  Transportation  railways  losses  the  $22.3  relieve  the  Commission  in  did  C o m m i s s i o n on  and  MacPherson  that  Commission  $13  with  ever-increasing  received  another Royal  this  three.  that  faced  levels.  Therefore,  the  but  were  of about  that  industry  the on  the  ever-increasing  provincial became set  the  recommended  changes  The  grain  branchline  moving  a  report  this  ation  policy  grain  freight  including rates?  report  delivered  i n 1 9 6 1 , came  turbulent  periods  elections  held  minority  governments.  on  i n 1963 and 1 9 6 5 .  freeze  was  placed  MacPherson  Report  and  finally  i n a minority  significant  never  before able  i n an  atmosphere  that  general  remained  in  formed  the  t h i s period of time a  discussed Act ( B i l l  - 202 -  t h e most  resulted i n  Liberals  abandonment  situation.  of  of  Report,  There were  1965 w h i c h  During  issue  Commission  Conservatives  on b r a n c h l i n e  o f a new T r a n s p o r t a t i o n  Parliament  for  contentious  Pearson  government  was  Diefenbaker  t h e e v e o f one  The the  the  Parliament  i n Canada's h i s t o r y .  and  subsidies  Was  MacPherson  i n 1 9 6 2 , 1963  1962  Commission  changes t o n a t i o n a l t r a n s p o r t -  the highly The  levels  lines.  the kind  i n Canada.  significant  rate  further  called  policy,  r e s u l t i n fundamental  part  and  by  branchlines  MacPherson  presented  which  to a Parliament  in  The  Commission  could  office  of  f o r l o s s e s i n c u r r e d on t h e s e  with  discuss  constructed  at f r e i g h t  abandonment  to transportation  presented  being  viability  Century.  MacPherson  Government  to  on  19th  to the railways  The  network  governments.  dependent  in  road  a n d when t h e  i n Parliament, C-231),  Moreover,  i t was  as a  52 o f t h e  97  Conservative  seats  were  from  the  three  prairie  provinces.  Included Minister  inBill  Jack  C-231 ,  Pickersgill,  recommendation  calling  inclusion  this  Premier that,  of  (Woodrow "...the  solution",  further, concern public  Manitoba  stating that  a  funds".  MacPherson  that  Commission's  sweeping  proposals  by  one  to divert  approved the  t o scrap  Committee A  the existing  ( S C ) went public  be t a k e n  from  Transportation  reaction to  from  grain  i t s more  structure of rate  Darling's point, this reaction s u b s i d y a p p r o a c h f o r g r a i n as  on T r a n s p o r t  revised  by t h e House  National  a  ( P C ) was  on uneconomic  a t t e n t i o n away  Notwithstanding  vote.  concern"  grave  magnitude  finding  did help t o defeat the direct Standing  Manning  occasion  NDP  requiring  Roblin  t o Howard D a r l i n g h o w e v e r , t h i s  tended  the  The  2 7  services  regulation.  an i s s u e Duff  must  Report  subsidy.  h i s "deep  Premier  o f such  Transport  Saskatchewan's  even  Premier  "...it  subsidy  grain  caused  r a t e s were  by then  t h e MacPherson  t o express  and A l b e r t a ' s  According the  section  grain  "disappointed"  was  f o r a direct  Lloyd)  while  submitted  2 6  proposal  defeated was  the proposal  re-submitted  and  o f Commons a n d was i n c o r p o r a t e d i n Act.  The  - 203 -  revised  proposal  was a  disaster!  I t c r e a t e d two  which  were  to  which  were  unprotected  protected  for  Commission  before  cases  CTC  uneconomic railways  but  were  eligible  had  a  required faced  could  determine in  with  a p p l y t o abandon a l i n e  a  Jamieson  the  Minister  between  following period  passage  of  attention  of  and the the  development matters  of  region  large  was,  Department of  the  to of  and  of  1972.  the  degree,  sector  Less  than  one  - 204  Transport In  these  interest.  The  they the  had  the  was  Transport  that  focused  r e g i o n and and  relatively grain  period  three on  cent  of  the  Prairie  the  federal  uninformed handling  explained  the  year  regional  the Department between  -  to  line  immediate  is partially  per  a  was  was  i n the western  o r g a n i z a t i o n of  of  branchline  thought  ignored  remained  This  subject  whereby  During  the A t l a n t i c  crisis  the  the  department  Transport  impending  transportation review  a  the  and  granted.  1972, NTA.  The  uneconomic,  granted.  Newfoundland  1968  those  automatically  public  i f they  and  Canadian  be  situation  (even  from  the  that  r e q u i r e d ) b e f o r e a s u b s i d y c o u l d be  Don  was  t o be  to  those  abandonment.  i n fact  first  subsidy to  for  miles)  application  had  abandonment  i f t h e y were  category  abandonment  the  or  from  (17,500  subsidy  unprotected  railway  protected  category  eligible the  be  c a t e g o r i e s of b r a n c h l i n e :  and  by  a  1968  Department's  manpower was a s s i g n e d  to surface  all  responsibilities  of the regulatory  were  assigned  Whatever  to  the  expertise  that  transportation  Canadian was  i s s u e s and  f o rgrain  Transport  available  transport  Commission.  t o t h e government  came o u t o f t h e O f f i c e o f t h e M i n i s t e r R e s p o n s i b l e f o r t h e C a n a d i a n Wheat B o a r d .  The  prairie  grain  handling  and t r a n s p o r t a t i o n  system  (GHTS) as shown i n Table 11: The Canadian Grain Production,  Handling  and Transportation System, (1980) i s h u g e , c o m p l e x and d y n a m i c .  In major  the early problems  emerging  1970s,  and  that  the  as t h e major  huge  legacy  issue  system  of  began  t o cause  t h e Crow  i n the prairies.  Rate  was  The  Crow  R a t e a f f e c t e d b o t h t h e movement a n d m a r k e t i n g o f g r a i n .  The 1924  and  three  Prairie  t h e main  advocacy o f " o r d e r l y the  Pools  grain  reasoned  deliveries,  Wheat  theme  could  market control  of  that  world  share.  were  their  marketing".  grain  formation  farmers  prices  could  was  "pooled" be  grain  - 205 -  reasoned  their of  their  influenced.  that  marketplace  until  leaders  of the key ingredient  The P o o l s  t h e Canadian  n o t formed  The f o u n d i n g  i fprairie  Thus began t h e e s t a b l i s h m e n t policy:  Pools  o f Pool i f they  they  could  dictate  price.  throughout prices  was  the prairies  fell  campaign  to  $1.00  caused  legislation required  the  to deliver this  dream  that  sold  ( a t a t i m e when w h e a t  a  One  bushel).  Saskatchewan dictated  result  of  this  to  pass  a l l farmers  were  Government that  t o S a s k a t c h e w a n Wheat  piece  was  of  legislation  was  Pool.  Shortly  disgualified  by  Courts.  Between grains grain the  under  banks  Pools  a joint  1935  In  The cent  CWB  of  Wheat  1935  the  adding  loans  Canadian Pool  up  Pool).  each  i n dictating  the price  year's  own When  federal  keep  Board  the (CWB)  adopted t h e receipts  t o g u a n t i t y and Thus t h e r e  and  quality,  are strong  and t h e P o o l s .  a g e n c y f o r a b o u t 80 p e r but  i t has  not  o f g r a i n and e v e n  g r a i n c o m p e t i t i v e t o "Chicago"  - 206 -  to  Wheat  l i n k s b e t w e e n t h e CWB  exports  The  b u t t h e CWB  producers.  grain  their  a t T h u n d e r B a y i n 1930  guaranteed  i s the sole marketing  Canada's  successful sells  and  them e q u a l l y , a c c o r d i n g  deep h i s t o r i c a l  marketed  t o c l o s e down t h e P o o l s .  t h e C a n a d i a n Wheat of  (Canadian  t o .55cf a b u s h e l  among a l l p a r t i c i p a t i n g and  the Pools  agency  intervened  policy  dividing  and  attempted  alive.  replaced Pools  1924  prices f e l l  government  it  the  i n t h e 1920s  i n 1931 w h i c h  thereafter the  This  prices.  been today  This from  set-back d i d not deter  placing  amount  emphasis  of effort  on  was made  " o r d e r l y m a r k e t i n g " would  the P r a i r i e  politics  and  t o ensure  continue.  persuasive  a  that  Pools  considerable t h e dream  Through  i n t h e Canadian Wheat Board Act  powers  Wheat  of  i t s marketing  t h e Board  c o n t r o l of both the g r a i n handling  exercises  and t r a n s p o r t  system.  It  i s not unfair  system  as  mechanisms  one  control the  as  quota  of grain  system,  the and  t h e Board  t h e Board  that  control)  through  controls  through  control  pick-up  a loaded  car.  However,  companies  advise  t h e Board  elevators  should  receive  eight  grain  The  oligopolistic elevator Pools  owning about  of  handling system w i t h  railway  car  system. order  It  to the  a n empty o r  grain  handling respective  cars.  companies the three  65 p e r c e n t o f t h e s y s t e m .  - 207 -  Through the  as t o w h i c h o f t h e i r  available railway  and  into  place  the eight  to price  2 8  entry  shipping  should  quantity  regulate  the transport  the actual  as t o where t h e r a i l w a y s  to  the system.  Board  railway  handling  as o p p o s e d  methods  controls  issues  the grain  administrative  t h e predominant  system  allocation,  mainly  t h e Board's  the flow  elevator  is  using  (under  mechanisms,  to characterize  operate Prairie  an  Wheat  As  a  result  the  three  Prairie  Wheat  Pools,  C a n a d i a n Wheat B o a r d and S e n a t o r H a z e n A r g u e o p p o s e d to  t h e Crow R a t e  s y s t e m away f r o m oriented  government oppose speak Prior Board, Wheat  and  of  and  change  less  as  such  b u t one  and  Commissioner, against  Gibbings  as was  the  The  federal  Gibbings d i d  t o t h e Crow R a t e .  president  - 208 -  market  d i d not openly  Commissioner  Pool.  move t h e  control.  Charles  changes  change  a more  a r e a p p o i n t e d by  the Commissioners  h i s appointment  Charles  change c o u l d  regulation  the Board  out p a r t i c u l a r l y to  that  " o r d e r l y marketing" towards  system  Commissioners  on t h e b a s i s  the  of  of  the  2 9  Wheat  Saskatchewan  Table  11:  The C a n a d i a n G r a i n P r o d u c t i o n . H a n d l i n g T r a n s p o r t a t i o n S y s t e m . C i r c a 1980  148,000  producers had  47  million  25  million about  acres  28  million y e a r to  t o n n e s o f g r a i n and o i l s e e d s p e r  3,700  country  e l e v a t o r s l o c a t e d at  1,500  r a i l w a y s h i p p i n g p o i n t s s e r v e d by  17,000  miles of r a i l  13,000  b o x c a r s and  10,000  h o p p e r c a r s with  379  locomotives  20  t e r m i n a l e l e v a t o r s (3.9 m i l l i o n metric tonne storage capacity) located at Vancouver, P r i n c e Rupert, Thunder Bay and C h u r c h i l l , M a n i t o b a , f r o m which  21.9  million  $3.4  b i l l i o n were e x p o r t e d t h e 1977-78 c r o p y e a r .  Source:  i n the three  Prairie  and  provinces  a c r e s p l a n t e d and summer  line.  fallow  to deliver  I t i s moved by  to  t o n n e s worth from  reserves f o r  Ropertz, Henry "Contemporary Issues in Grain Handling and Transportation" Seminar. University of Guelph, March, 1980 cited in Economic Intervention and Regulation in Canadian Agriculture by J. D. Forbes, R. D. Hughes, T. K. Warley. A Study prepared for the Institute for Research in Public Policy. 1982  - 209 -  The  grain  consistent from  and  handling responsive  Saskatoon,  in  lieu  formed  the  of  Grains  officials  with  production  provide  Mr.  require  in  Department  grain  Lang  Canada of  industry,  was  liaison  with  change.  The  Lang  to  the  had  Mr.  transport  First  of  a l l Mr.  Lang  comprised  of  transportation  the  Grain  purpose  virtually  Lang  was  of  a  Handling  and  this  was  he  role  to  would  The  no  and  began  data  Council  instrumental also  representatives to  act  as  a  Council  launch  such,  from  and  was  many  in  to of  to  federal in  this  his  The  a l l facets  of  reach  the  m e m b e r s h i p i n 1973.  three  i t s time  - 210  a  grain  withdrew t h e i r  l o t of  establishing  1969.  provide  As  a  in  forum f o r d i s c u s s i o n ,  government  devoted  Canadian  the  initiatives.  initiatives.  Council  the  in  qualitative  policy  Lang  Lang became-Transport M i n i s t e r .  Grains  comprised  for  role  on The  requires  r e s u l t Otto  organization  studies  with  a  organization  This  Transport  Secondly,  an  (GHTS).  subsequent of  larger  marketing,  of  System  p r o c e s s u n t i l Mr.  the  Group,  series  Transportation  a  Jamieson.  expertise.  comprehensive  As  system  Responsible  play  Mr.  transport  policies.  Minister  Wheat B o a r d , b e g a n t o sector  and  -  a  the  grain  provide  consensus  platform  Mr.  related  wheat  pools  S e c r e t a r i a t of  assessing  the  a for  for  transport  prairie The  Council,  GHTS  the and  the  three  this of  pools  became c o n c e r n e d  attention. Mr. Lang  initiative  The t h i r d  step  was t o f i n d that  he  over  t h e consequences o f  i n this  overall  an o p p o r t u n i t y  could  call  strategy  t o launch h i s  t h e "Bold  Approach"  to  a d d r e s s t h e p r o b l e m s o f GHTS. 4.2.1  The B o l d The  general  Liberals were  July  problems also  producer costs. July,  reason  was h e l d  this  problems  i n Canada  and t h e r a i l w a y The e i g h t h g e n e r a l  and b o t h  election  had h i s G r a i n s  and  i t s  put western  agenda.  the western rising  i n 17 y e a r s regained  M i n i s t e r was O t t o  Group*  I t was  became o n e o f  significantly  1974 a n d t h e T r u d e a u L i b e r a l s  Lang  that the  i n Calgary i n  o f OPEC,  inflation  faced  T h e new T r a n s p o r t  20  and t h e t r a n s p o r t a t i o n  the formation  that  the  on t h e economic development  resources  period  i n  o f which  (previously discussed)  a new f o c u s  with  resulted  46 s e a t s  a t t h e f o r e f r o n t of t h e Canadian  government.  Mr.  Conference  Western  combined  during  central  in  provided  losing  was t h e p r i m e  The C o n f e r e n c e  t h e west.  system,  Canada,  Opportunities  1973.  o f 1972, w h i c h  Mr. Trudeau  i n western  follow-up of  election  under  Economic  Approach  officials  took  the  grain input place  a majority Lang.  prepare  a  *By this time the Department of Transport officials began to play a significant role in the Grains Group  - 211 -  Memorandum t o C a b i n e t as a h i g h p r i o r i t y . which  included  initiatives, doubt and  but  became  because  known  measures  Ironically  a series  grain  handling  were  ever  t h e most  considered  transportation Approach",  f o r the grain resulted  o f ad hoc r e s p o n s e s t o t h e p r o b l e m s o f t h e GHTS of the "Bold  Approach"  3 0  1.  E s t a b l i s h m e n t o f a B e n e f i t G u a r a n t e e S u b s i d y - an indefinite compensation t o farmers f o r higher freight rates.  2.  Appointment o f a Commission Moving G r a i n by R a i l .  3.  Appointment of Rationalization.  4.  Appointment o f a Commission on t h e F i n a n c i a l O b l i g a t i o n s o f CP R a i l as a R e s u l t o f t h e Crow Rate Agreement.  5.  E s t a b l i s h m e n t o f an I n c e n t i v e and E l e v a t o r R a t i o n a l i z a t i o n .  System  On O c t o b e r 2 9 , 1974 O t t o L a n g  signalled  was be  no  comprehensive  over time t h e "Bold Approach"  i n 1974 t h e k e y c o m p o n e n t s  were:  and  a s t h e "The B o l d  the i n i t i a t i v e s  significant  sector. in  major  The Memorandum,  a p p r o a c h i n g when resolved.  3 1  Canadian Grain  a  on  Commission  the root problem  He a d d r e s s e d  the Costs on  of  Branchline  f o r Trucking  that t h e time  o f t h e GHTS h a d t o  a semi-annual meeting of the  Council.  - 212 -  "Lang a p p r o a c h e d t h e p o d i u m t h a t e v e n i n g w i t h the i n t e n t i o n o f b e i n g t o u g h enough t o convey the m e s s a g e he f e l t t h e Crow R a t e s h o u l d be changed, but vague enough that such an i n t e n t i o n c o u l d n o t be p i n n e d on h i m . . . w h i l e he s a i d he b e l i e v e d i n p r e s e r v i n g t h e full b e n e f i t o f t h e Crow R a t e f o r p r a i r i e grain f a r m e r s , he w o n d e r e d i f t h e b e n e f i t s s h o u l d n o t be c o n f e r r e d i n b e t t e r ways t h a n t h r o u g h an i n f l e x i b l e r a t e b e l o w r e a l c o s t s . " 3 2  A t t h e same m e e t i n g he a l s o  argued;  " I t i s l i k e l y t h a t t h e Crow R a t e on d o m e s t i c g r a i n i s h a r m f u l t o western development in l i v e s t o c k and t h a t t h e Crow R a t e s on e x p o r t grain are discouraging t h e e x p o r t o f more w h e a t and g r a i n p r o d u c t s . 3 3  The no  public  immediate  reaction  support f o r t h i s  provincial  leader  Dave S t e w a r t , a t t e m p t e d and  Mr.  Lang.  Saskatchewan  A  of  was  "courageous the  t o put  and  speech".  Saskatchewan distance  r e s o l u t i o n was  Legislature  devastating.  between  There  was  Even  the  Liberals, his  passed unanimously i t  was  directed  Party by  to  Trudeau:  "...the r e s o l u t i o n protested s u g g e s t i o n s by t h e M i n i s t e r i n C h a r g e o f t h e C a n a d i a n Wheat Board t h a t t h e Crow's N e s t R a t e s be discontinued and reguests your assurance that t h i s h i s t o r i c r i g h t of w e s t e r n Canada w i l l continue t o be guaranteed by the federal government." 3 4  - 213  -  the Mr.  The the  Prime M i n i s t e r  Department  undertaking  of  a  policy  and  commit  itself  r e v i e w was  Transport,  major  was  responded w i t h  review  anxious in  any  complete.  be  launched  resolution Lang's  and  earnest.  A  address  problems this  i s s u e was  the  strategy,  the  no  "benefit"  assurance  Rate  economic  doubt  the  being  Mr.  i m m e d i a t e l y was  west  a  years  of  that  of  Crow  for  of a  speech in  the  After  Mr.  the  Rate  in  of  "Bold  his  to  i s to  problems  sight  his  later.  thesis  public  factor  moved  Canadian-style lose  little  that  was  issue  this  and  implement  and  some e i g h t  cannot  event  is  awareness  in  in  the  absolute  to  debate  Crow  Canadian  debated  any  Rate  c o n t r i b u t i o n of  one  transportation until  an  unable  there  public  initiatives  In  was  rate  inherent  regard  t o any  the  speech  burners  to  Crow  of  not  changed.  However,  the  of  government  p r o v i n c i a l government  Lang  process  by  transportation  federal  t e l e x confirmed  r a t e would not  Approach".  the  give  the  national  The  the  Mr.  in  area of  d i d not  support,  was  one  Crow R a t e b u t  any  of  that  the  Without  which  a t e l e x prepared  front  began reveal  ways  of  the  federalism.  In  the  lengthy  spite  in  fact  that  period  the  prior  t a k e n t o c h a n g e t h e Crow R a t e .  Lang,  rebuffed  confronted  - 214  -  with  over  his  several  overall problems.  The  first  problem  was  that  the  freeze  a b a n d o n m e n t , e s t a b l i s h e d i n 1967 d u r i n g National  Transportation  1974.  The d e c i s i o n o f t h e g o v e r n m e n t  the  Crow  Rate  financial  that  the  or  problem  1974,  the p r a i r i e  years!  perhaps  The p e r c e p t i o n  could  on  mean  abandonments a u t h o r i z e d between way  f o r a highway  i n Alberta  service the Gardiner too  Commission  back i n  purse.  was  f o r the  next  politicians, led  Premiers,  so  too large,  that  knell  of  intense  branchline many  that  small  the  only  1967 a n d 1974 w e r e t o make  and t o remove a s p u r b u i l t t o  site.25  N o t o n l y was t h e n e t w o r k  l a r g e b u t most o f t h e t r a c k and r e l a t e d r o a d b e d was i n  virtually not  Dam  serious  of p r a i r i e  was  addressing  have  unchanged  the death  the prairies  to  network  virtually  e x p l o i t e d by p r a i r i e  abandonment villages  remained  a t t h e end o f  to avoid  was  of t h e Duff  branchline  branchline  d i s c u s s i o n of the  due t o e x p i r e  in  the warning  network  thirty  was  implications f o rthe public  Despite 1933  Act,  on  inoperable  prepared  collection  The First  how  condition.  to re-invest  n e t w o r k as l o n g  sparse  with  ( t h e word t h e government  capital  simply  into  were  the grain  as t h e Crow R a t e was i n e f f e c t .  f e d e r a l g o v e r n m e n t was to deal  The r a i l w a y s  faced  the overall  with  rail  two  problems.  "rationalization"  and t h e r a i l w a y s p r e f e r r e d  - 215 -  t o use  instead "rail to  o f "abandonment") rehabilitation"  deal  government  with  In  1975  the Grain  the  Emmett  assignments  for  Canada  for  and  and  announced  the  of  the  apparently  of  Mr.  federal  Medicare  chose  Hall  who,  now  the contentious  be  studied,  Lang  doubt  wanted  who  w o u l d be w e l l - r e c e i v e d by w e s t e r n  Hall  Commission  public  hearings  hearings  were  became a c e l e b r i t y . of  this  type  no  of  held The  hearing  spent in  western  traditional was  - 216  laid  the in  to avoid a matters  to appoint  years  to  someone  in  Canada.  towns  where  holding Many Mr.  quasi-judicial  dismissed  -  earlier  politicians.  two  i n small  ignore  entrenched  given  these  in  government,  Program  Court,  to  recommended g e n e r o u s p a y s e t t l e m e n t s  Mr.  the  formation  Supreme  However,  extensive  issue response  railway strike.  The  preferred  abandonment  traditional  Justice  record  the  the  government  pay f o r  T r a n s p o r t a t i o n Commission under  government  track  should  Commission.  former  The  "populist"  its  t h e government  of  Hall.  groundwork  to  Handling  direction  the  branchline  of a Royal  April  who  repair").  the  resorted  establishment  the  ( t h e word  use i n p l a c e of " r a i l  To  of  and s e c o n d l y  by  Mr.  of Hall  nature  Hall.  He  wanted  to  get  the  sentiment  of  the  grassroots  on  grain  issues.  One  can  easily  speculate  t o r e g r e t h i s appointment of Anderson Page  on  Page  226) .  and  the  In  May  government  which  contained  with  little  technical many Two  225  of  and 1977  the  was  faced  no  key  in  terms  evaluate  one-third  of  the  up the be the be  to  1988.  basic placed  It  under  Prairie funded  lines  by  the  up  to  a  decision  as  to  that  public  a  report  recommendations Indeed,  contained  the  in  the to  Volume  I.  the  It  i n stages  that  1,813  remaining a  (PRA).  12  status  - 217  years, would  -  Commission  6,300 m i l e s  new This  f e d e r a l g o v e r n m e n t , was  their  with  on  I I I were c o n t r a d i c t o r y  system.  Authority  of  Fred  Premiers made  support.  a u t h o r i t y of  period  was  dealing  approximately  abandoned  and the  Rail  Report  learned  quote of  western  branchlines,  recommended  network  soon  here.  existing be  (See  of  with  I I and  of  to  miles  Hall  recommendations  instructed  a b o u t 2,165  Hall.  technical  examples are d i s c u s s e d  First,  Lang  subsidy-related  r e l a t e d Volumes the  Mr.  Mr.  reaction  massive  or  that  about  recommended beginning miles  be  body t o  that  in  1978  added  mileage  of  to  be  called  operate which  to  2,344  organization,  during be  or  was  these  time  determined.  to  a The  establishment have  to  of  be  PRA  implied  undertaken  to  that  c o s t l y r e p a i r work would  ensure  that  traffic  support  for  could  be  moved s a f e l y .  There  was  recommendation The  grain  could unless be a  from  not  invest  that  particularly  in their  The  lines, were  of  ultimately  Transport another  as  to  of  (PRAC)  Anderson.  On  creation,  the  November 30  PRAC  not  be  assigned  1978,  submitted  its  for  lines  status  could that  maintain if  this  PRA  of  eighteen  PRA  to  Prairie  direction  they  required  the  the  sector.  concerned  required  I t was  known as  under  was  key  that on  long-term  would  Lang  grain  located  was  abandoned.  organization  Committee  their  money  the  this  complained  government  which  Minister  in  facilities  federal  amount some  no  organization  a firm decision  substantial  lines  any  companies  determined.  these  yet  virtually  reason  mileage Rail  final  to  Action  Professor months  the  Fred  after i t s  report  which  recommended:  a)  the a d d i t i o n network;  b)  the abandonment six-year period.  The  second  of  1,044 of  miles 1,407  i s s u e w h i c h needs t o  - 218  -  to  the  miles  be  basic  over  discussed  a  is  the  Hall  Commission's  Rate.  The  reimbursed this it  may  Commission  concerning  recommended  f o r losses  o f moving  that  the  grain.  At  a p p e a r t o be a p r e c e d e n t s e t t i n g  was  not.  railway  recommendations  loss  Commission  The on  MacPherson  grain  Report  Commission  movement  lacked  back  the  Crow  railways first  be  glance  recommendation, identified  i n 1959.  The  the Hall  t h e substance of t h e MacPherson  Commission Report, completed f i f t e e n years e a r l i e r .  According Secretary  to  t o Fred the  Anderson,  MacPherson  Research D i r e c t o r  Commission,  the  and Hall  Commission Report:  ...confirmed a l l the unconfirmable myths. The r e p o r t i s c o u c h e d i n t e r m s w h i c h hang on t o t h e s t a t u s q u o . The r e c o m m e n d a t i o n s s o u n d like radical changes b u t under e x a m i n a t i o n o n l y perpetuate the present. This approach i s what t h e west e x p e c t e d f r o m t h e MacPherson Commission but d i d not get i t . 3  Professor  Anderson's  reviewing the Hall  Another relevant Rate. to  The H a l l  the  Commission  example  to this  railway-  concerns  are e a s i l y  when  the Hall  Commission,  and  i s h i s r e c o m m e n d a t i o n o n t h e Crow  Commission for  identified  report.  drawn from  thesis,  6  recommended  moving  grain.  - 219 -  a subsidy That  be  subsidy,  paid i f  implemented  by  taxpayer  excess  in  significant, point  the  the  where  (533  the  534)  are  Moreover,  much  of  of  under  affects  year.  would  the  Only  the  work  contained  d i r e c t i o n of describes the  Dr.  processing  of  simply  Hall  Commission  milling  industry  natural  Canada", crushing  3 7  geographic and  The  Hall  Commission  politicians Lougheed of  be  the  of  paid  linkage  t h e s e recommendations i s not  Notwithstanding  the  A l b e r t a , the  pages to  Volume  II  how  the  Crow  grain  and  meat  this technical  locating to a s s i s t  industry on  report.  in the  branchlines, According  would have  - 220  -  enjoy  western rapeseed  a  and  Report.  concerns  report  to  the  Crow R a t e  made i n t h e H a l l  grain  that  permitted  between the  recommendations  embraced  any  issue  recommended  i n C a n a d a be  advantage  more s u b s i d y  industry.  a  Tyrchniewicz,  in detail  data,  the  two  in  Ed  Notwithstanding  "...flour  to  Rate  p r o d u c t s i n w e s t e r n Canada. the  to  "free"  lead  Crow  more  year  receive not  the  Even  every  could  to  costing  magnitude.  Manitoba,  adversely  a  reductions.  devoted  of t h i s  Research Reports, University  scheme  cost  be  increase  producer a  or  would  million  would  grain  efficiencies and  $600  Such  support a subsidy  Rate  of  subsidy  transportation. system  government,  to  for  the  prairie Premier  profound  and  positive Ottawa  impact ignore  Manitoba  said  "in  Alberta) that  issues Hall  was  special  Hall  report  Schreyer  of  Mazankowski,  debate  on  the  PC Hall  a t WEOC i n 1 9 7 3 .  the  could  rather  Western  Economic  b e c a u s e many o f t h e  n o t be  supported.  than being  a "new  The  economic  f o r t h e w e s t , as i n t e r p r e t e d by Mr. M a z a n k o w s k i , 3 9  y e t a n o t h e r example federalism.  s y s t e m was  addressing  the  Commission,  root  in a  of lack  of the f a i l u r e  The  adversarial  cause  not l e t  had a d d r e s s e d a l l t h e i s s u e s  indicated,  by t h e west  Commission  of  Don  C o n f e r e n c e (WEOC) f a i l e d  raised  charter"  Premier  Ottawa,  in a  Judge  previously  Opportunities  could  w i t h t h e recommendations  i g n o r e d by t h e f e d e r a l government  As  he  3 8  Parliament  said  and vowed  he was i n a g r e e m e n t  (Vegreville, Report  Alberta  i t s recommendations.  in the r e p o r t .  In  on  negative a t work causes  classic  o f economic  attitude of the railways  o f Canada's  aspects once  of  again.  the  populist  of  vein,  development  Canada's  Rather  problem  style  than  the  Hall  described  the  i n t h e west on t h e  and t h e f e d e r a l  government.  (See  appointed  body  Volume I , pg. 2 7 3 ) .  The  Hall  Commission  was  a  - 221 -  federal  reporting railway  to  federal  policy  responded  and  and  solutions  to  long  standing  identify  constructive  There  their  reaction  their  respective  It  is  no  report  province  but  to  the  way  that  the  none  of  that  contained  failed  in  1979  or  Commission required  by  to  either  since  being  even  law  before  i n a major  difficult  to  by  the  Premiers  believed  well-received must  voters  the  to  This  be  the  in  more  take  in some  their  who  during  their  re-elected  own  review  a branchline  required  - 222  -  so  strongly  short-term  i n 1984!  by  could  Report  be  hundred  were  ever  when  one  supported  of the H a l l Commission  rail  reviewed  one  significant  any  on  over  Hall  implement  recommendations  Commission. hearing  is  in  the C o n s e r v a t i v e s ,  recommendations  the  provided  Premiers  which  considers  report,  be  in  This  the  the  would  implemented. that  is  of  issues.  surprising  recommendations  government)  have r e s u l t e d  criticism  doubt  offered  Implementation  It  for  Premiers  i t  federal  funds.  the  for  react  not  is to  responsibility province  public  The  because  issues.  of  responsible  Canada.  the  recommendations would  any  was  report  (to  mis-allocation  Premiers.  who in  the  expensive  to  Report  minister  regulation  positively  popular  Hall  a  line the  office  Even the  Hall  abandonment  were  Canadian  yet  in  Transport  another  abandoned.  public  The was  most  important  the establishment  Moving  Grain  i n i t i a t i v e undertaken of t h e Commission  by R a i l .  Despite  MacPherson Commission t h a t on  addressed unusual The  by  Parliament  was  i n 1967 when  politicians  not f u l l y  were  not prepared  at  levels  freight  rate  MacPherson Commission f i n d i n g between  t h e Crow  the  f o r constructing  CPR  Rate  O n t a r i o t o Vancouver,  Therefore, grain  Century,  Mr.  addition  to  rail  British  t o proceed  handling  and  Lang  or  h i s attempt  the  many  western  money m o v i n g accept  the grain  another  line  assets from  provided to  near  Sudbury,  Columbia.  with  to  partially  (a) accept  (b)  and  h i s plan  transportation had  (based  t h e r e was no c o n n e c t i o n  commitment a  money  because  lost  that  of the  i t established  to either  actually  of  d e s c r i b e d on page 200.  addressed  findings that the railway 1899  lost  t h e m a t t e r was o n l y  b r a n c h l i n e s u b s i d y program  matter  t h e Cost  t h e 1961 f i n d i n g s  the railways  1958 c o s t s ) m o v i n g g r a i n ,  on  by Mr. Lang  address to  to  bring  the 20th  sector  into  the  these  two  areas  rationalize  in  the branchline  issue.  Mr. colleagues obligations  Lang  was  unable  to establish  a  to Royal  convince Commission  f o r assets received to build  - 223 -  his on  Cabinet the  CPR  t h e CPR m a i n l i n e  linking  the  Coast.  He  was  Commission believed until  at the  the  heartland  the  of  Ontario  successful  however  Cost of  Moving G r a i n  Crow R a t e  prairie  that  grain  issue  were  was  chapter  will  be  discussed  finding  some  special  someone  association  interest  virtually  by  Rail.  never  of  the  Commission,  there  expertise.  As  consultant  at  To  by  in  with  at  groups  second  on  this  least  concerned In  Lang  addressed  moving  and  the  nobody w i t h  result  the  name o f  Mr.  to  grain  appreciate  Snavely news".  when he  "...was He  1899  f a r m e r s and  was  the  amazed  that  that "...a  f r e i g h t r a t e w o u l d be the  railways".  4 0  - 224  -  the  multi-  recognized,  was  Transport  rail  appointed  an  was  costing American  to  become  farm.  freight rate  this  not  was  Canadian  question of  did  issue,  a r r i v e d i n Canada t o  bewildered  this  this  S n a v e l y , who  magnitude of  of  who  of  sufficient  Lang  Carl  i t  half  job,  one  with  addition  railways was  the  take  a  prairies,  an  the  least willing  a name known on v i r t u a l l y e v e r y p r a i r i e g r a i n  of  west  Mr.  be  l o s i n g money  to  impossible.  outside  the  the  establishing  could  producer  railways  in  to  Crow R a t e .  As  have  on  that the  the  concede  industrial  issues  begin his  was of  i n t e r e s t to  front the  on  work page  effects  anyone  but  Given Snavely to  the  political  astutely established  a s s i s t him  broad  in  range  his  of  every  Mr.  o f CP  this  issue,  The  Committee  participants known as  committee  represented  including the  the  National  Mr.  a  extreme  Farmers  Union  S n a v e l y made c e r t a i n t h a t t h i s g r o u p u n d e r s t o o d  aspect  Committee  of  a t e c h n i c a l working  work.  left-wing organization (NFU).  repercussions  of  to  Rail,  his  work.  Windsor and  had  In  Station  the  one  instance  i n Montreal,  he  the  took  head  his  office  railways:  open their books on rail costing procedures. Snavely would not let anyone l e a v e t h e room, i n c l u d i n g NFU President Roy A t k i n s o n , u n t i l t h e y were s a t i s f i e d t h a t t h e y understood the basis of the railway estimates. 4 1  Snavely claims conducted  largely  arguments. based  in  which  1974  government  Snavely  his  w o r k on the  between  costs, railway  the  realm  calculating  railway  his  Crow d e b a t e  of  was  the  political  benchmark  decision,  Snavely estimate  derived and  a  figure  provincial  conclusions.  first  concluded  movement and  this  outside  When  4 2  fell  In  that  set  report the the  t o Mr.  railways  Lang, d e l i v e r e d i n w e r e l o s i n g money on  figure for  - 225  1976 ,  1974  -  at  $103  million.  4 3  grain In  1979  an u p d a t e  million.  produced  figures  A f u r t h e r update  was p r o d u c e d  12: Cost of Moving Grain by Rail. between (the  1974  while  branchline per  I t i s significant  the  decreased  from  federal  subsidy,  increased  c e n t and t h e r a i l w a y  share  from  See Table  share  t o note  that  of  cost  36.3 p e r c e n t  government  o f $160.5  i n 1980.  and 1980 t h e p r o d u c e r ' s  Crow R a t e )  cent  f o r 1977 l o s s e s  the  t o 24.3 p e r  share,  through  22.0 p e r c e n t  (in this  case  the  t o 31.1  railway  loss)  r e a c h e d 44.6 p e r c e n t .  Given Snavely debate  t h e manner  i s generally from whether  i n which  he u n d e r t o o k  credited  with  Mr.  Lang  Commission  and,  while  discussion  has  never  been  Report  Farmers moving  Union  money  Report.  no  organization  claimed that  from t h e  S n a v e l y was  on t h e magnitude agreed  moving  losses.  But C a r l  totally  Crow  upon,  of  railways  railway  after  including  successful losses  the  the  first  National  w e r e n o t l o s i n g money  grain.  The report  lost  the  d i d n o t g e t t h e r e s u l t s he d e s i r e d  Hall  Snavely  directing  or not the railways  g r a i n t o who s h o u l d p a y f o r r a i l w a y  h i s w o r k , Mr.  Snavely  Report  i s w i t h o u t a doubt  and M r . S n a v e l y ' s w o r k was  - 226 -  a major  a  significant  f a c t o r , i n Crow  T a b l e 12:  Cost of Moving G r a i n B y R a i l . 1974. 1977. 1980  1974  1977  1980  $ 89.717  $114,764  $132,873  54.364  78.638  170.166  103.109 $247,109  160.535 $353,938  244.441 $547,480  Amount o f C o s t C o v e r a g e ($Millions of Dollars) Producer  (Crow)  F e d e r a l Government Payments Railway Losses Total  D i s t r i b u t i o n of Cost Coverage Producer  (Crow)  F e d e r a l Government Payments Railway Losses Total  36.3%  32.4%  24.3%  22.0  22.2  31.1  41.7 100.0%  45.4 100.0%  44.6 100.0%  Source:  Snavely Reports, 1976,1979,1980  NOTE:  The above t a b l e p r o v i d e s a comparison of the coverage of c o s t s i n c u r r e d by the Railways' i n the t r a n s p o r t a t i o n of g r a i n . The number assigned to the r a i l w a y s r e p r e s e n t l o s s e s .  - 227 -  change  b u t as t h e 1970's  lost grain brought  sales  due t o i n a d e q u a t e  t h e impact  the p r a i r i e g r a i n  4.3  came t o a c l o s e  o f t h e Crow R a t e  finally  t o t h e pocket-book of  producer.  P e r i o d o f Change (1980-1984)  handling changed  and over  producer  transportation time.  relatively  where e x c e p t  transportation.  grain  elevator  related  some i t e m s then  breaks  down.  that  unless  suffer  When  build  t h e Crow  warning  crop  years.  Rate  address  t h e Crow  failure Rate  grain  productive units i n record  c r o p s and  elements  change,  every-  such  and r o a d c o n s t r u c t i o n , relate  to that  (branchline  retention  a l l around  was  until  then  and Crow  t h e system  Commission  resolved  as  change b u t i f  t h e GHTS  Unfortunately f o r western  became r e a l i t y The  i t has  the western  t h e MacPherson  i n y e a r s t o come.  this  some  must  I n 1960-61  how  been d i s c u s s e d ) i n t h e a r e a o f  constant  tensions  the grain  Change was p a r a m o u n t  rationalization  remain  1970s  producing  high.  adjustments  Rates)  were  (as has j u s t  grain  i s and  one o f t h e most  The p r a i r i e s  were  how d y n a m i c  system  By t h e l a t e  h a d become  world.  prices  all  event,  transportation,  T a b l e s 1 0 , 11 and 12 i l l u s t r a t e  the  another  warned would Canada  d u r i n g t h e 1977-78 a n d 1978-79 of  the western  a t WEOC o r t h r o u g h  - 228 -  provinces  to  FP-COWT was t o  prove  costly.  In  record  harvests,  t h e GHTS was u n a b l e t o h a n d l e t h e demands  placed  upon  the  rail  repair  could  sales. been  Board,  following  grain lost  4 4  of  and p u r c h a s e  neglect  could  according to  Despite  n o t be  Up t o t h i s  point  the financial  of  overcome  of grain  i n time  grain  an e x p e n s i v e  o f thousands  t h e volume  from  successive  o r had t o f o r e g o  not handle  shielded  three  producers,  o f $1.1 b i l l i o n .  program  years  system meet  Wheat  i n excess  cars,  had  i t and w e s t e r n  Canadian  sales  1978-79,  hopper  and t h e  required  the grain  to  producer  a s p e c t s o f t h e Crow  R a t e b u t t h i s no l o n g e r was t h e c a s e .  The Crow  Rate,  delivery west,  classic that  system  the  railway  became  Crow R a t e ,  i n favour  Rate  Despite system  statutory)  the social  the existence  between  the  of the  producer  fabric  of the  virtually  1925 ( t h e d a t e  t h e Crow  underwent  the existence major  of the  change.  h a d b e e n a:  R e d u c t i o n i n t h e number f r o m 40 t o 8. R e d u c t i o n i n t h e number 5.700 t o 3.090.  - 229 -  a  of a  and, d e s p i t e  t h e GHTS s y s t e m  of retention  guaranteed  and g u a r a n t e e d  was w a n i n g .  unchanged Rate  argument  of grain  companies  of elevators  from  There  R e d u c t i o n i n t h e number f r o m 2 . 500 t o 1.245.  of  delivery  R e d u c t i o n i n t h e number o f g r a i n 250.000 t o 140.000.  More mainline  important and  one-fifth  secondary  of  the  the  reached  projected  losses  1990.  Grain  system  and  revenues. major more  addition  to  user  the  generate for CP  the Rail  to  the  volumes  system  r e a c h one 20  per  grain  on  resulted  250)  of  in  handling  after  coal,  i m p r o v e m e n t s when  was  not  i n 1980  with  dollars  the  the  the  railway  cent  to  railway  refusing  -  the  remaining  to  make  potash  second  In  t o borrow  to  traffic, to  in  not pay  addition,  money f o r  revenue  to  major  could  traffic  required.  enough  - 230  and  railways'  highest  by  of  coal  g r a i n was  i t s second  generating  cent  trans-  Canada t o expand c a p a c i t y  that  line  grain  billion  were  sulphur,  from  on  per  railways  Given  profit  3.5  finding i t difficult  even  (about  $300 m i l l i o n  s i g n i f i c a n t improvements was  from  of  which  losses  of  i n western  grain.  enough  railway  contributing  In addition  increasing  t o 1980  points  utilizing  investments  of  time  expected  only  consolidation  l i n e s up  i n excess  was  farms  grain.  same  portation  the  delivery  one-half of a l l the  At  was  points  rail  grain,  pay  for  the  cost  of  fuel.  Transportation dicting  that  Canada c o u l d because of  In  in early  Council  issued  losses  lose  one  up  to  to get  to  costs  in to  were  the  Crow  not  grain the  grain  Rate  C a n a d a , by effect of  insisting  not  value  processing  retaining  added.  determined  by  grain  set  is  transporting is  about  rate would higher the  For  the  grain  only  the  transportation  one-fifth be,  price  the  of  competitive  of  the  export the  what  to  the  and  storage  certain  and  discouraged  port.  Since  normal  r a t e of $25.00).  the See  -  in  the  the the  is of  cost  of  Crow  Rate  freight  p r a i r i e s pays a  Crow R a t e Table 22  terms  price  competitive  on  in  a l l grain  such the  minus  between  - 231  of  port  a  Western  advantage  as  crops  Crow R a t e , was  price  l i v e s t o c k feeder  (difference  to extra  It also  i t s geographical  to  1990  system  livestock production.  example,  grain  western  inefficiencies  applied  retention  the  pre-  4 5  ships.  Chicago market  at  report  market.  p r o d u c e r s due  and  on  Western  corrected  sales,  t h i s discouraged crop d i v e r s i f i c a t i o n . agricultural  the  b i l l i o n d o l l a r s a y e a r by  d e m u r r a g e on w a i t i n g  Since  1980 a  i t s products to  lost  capacity  and  result,  i f railway  addition  meant h i g h e r  a  Advisory  failure  inadequate  costs  As  on  $5.00 Page  and  334.  This  i n effect  additional such  the  crops,  grain  opponents  in  in  1980  two  primary  and  Crow the  the  change  upcoming  producer.  producers  debate.  (WAC)  (PFCC)  -  which from  As  speciality  livestock Crow  Conference  although  of  agricultural  statements  Crow,  grain  and  b r o a d l y based  policy  feeder but p r o v i d e s  producers  Rate,  Coalition  transportation to  livestock  the  Agricultural  Commodity  need  the  producer the  Western  Farm  for  under  result, the  revenue  not  became  penalizes  and  As  a  groups  -  the  Prairie  developed  grain  acknowledged sharply  the  different  perspectives.  The longer  four speak  Columbia Rate and  in  strongly  issue  to  because  of  enable  which  for  the  dollar  government  the  railways'  to  investment  most w o u l d  be  in British  such  government from  of  Alberta  supported  payments  - 232  to  -  British the  the  Crow  massive  upgraded  rail and  as p o t a s h , s u l p h u r  and  supporting the H a l l  direct  no  Columbia,  economy.  underwent  i t s payment o f s u b s i d y t o t h e  of  begin in  could of  resolution  i s important to the B r i t i s h Columbia  transformation  which  urged  governments  The  non-grain bulk t r a f f i c  The  with  provincial  unison.  multi-billion  capacity,  coal  western  significant  Commission  railways, the  a  to a  grain  Report, position  producer  to  alleviate  the  distortion  w h i c h were p r i m a r i l y  Within  the  against  the  livestock  located i n Alberta.  same v e i n ,  the  government of  advocated  no c h a n g e s i n c e 50  producers  were l o c a t e d i n t h a t p r o v i n c e .  The to  Manitoba  make  since  i t was  The  was  February  western  a  19,  of  arguably  makes  appointed  most  could  see  was  1980.  surprise  Minister  milestone  the  The  a l l primary  diversified strong  of  arguments  grain  choice  the  three  in  favour  this  i n the  for  the  conflict  and  this  election  Liberals  won  of  the  o n l y two  Liberals seats  in  i n Winnipeg.  choice  Transport  to  of  t h e most d i f f i c u l t  ripe  increased with  Canada, both  In  cent  Saskatchewan  change.  situation  situation in  no  per  g o v e r n m e n t had  p r a i r i e p r o v i n c e s and o f c h a n g e and  producers,  on  March  date  the  resolution  Cabinet  Saskatchewan.  This  oppose P e p i n ' s  attempts  Jean-Luc  of  was  former  3,  most the  Pepin 1980.  was His  significant  appointed appointment historical  Crow R a t e d e b a t e .  Senator member o f  Hazen the  NDP  Also  Argue  from  Party  would  t o s o l v e t h e Crow R a t e c o n u n d r u m .  - 233  -  4.4  The  Conflicts  This arose  section  during  involved  the  the  government  Crow  and  the  Jean-Luc  Pepin,  increase  in  the  which  the  losses  moving  the  (The  Hall  were  grain  by  producer  The  to  this  conflict  conflict  Cabinet who  and  federal  was  Ministers:  supported  Senator  an  Argue  who  Commission recommendation) receive  rail. would  of  that  conflict  the  second  Minister  rates;  first  between  federal  Transport  railways  grain  two  conflicts  The  Aspects  three.  freight  supported a p o l i c y  basic  debate.  provinces.  between  grain  three  differences  i n Chapter  differences  the  Rate  traditional  were d i s c u s s e d the  discusses  Under be  a  subsidy  Senator  spared  to  in  offset  Argue's  plan,  future  rate  any  increases.  The the  third  Crow R a t e  grain  producer  large  extent  extensively place  the  path.  and and  the  located  Crow R a t e  centre  in  in  Saskatchewan  Alberta.  t h o s e two debate  In  brought  urban  areas  of  more  importantly,  the  and,  small  l a r g e farm  operators.  - 234  turn  provinces  also  -  the  between  producer,  and  provinces and  to  throughout  livestock  located  rural  evolved  i t tended  Premiers of  The  between  conflict  the  the and  debate  the  this on  a  out  primary  former to the  on  a  latter  tended  to  conflicting differences  three  differences  prairie between  4.4.1  Sectorial  Differences  Before discussing government  and  differences necessary  the  within to  provincial each  introduce  largest•agricultural the  the d i f f e r e n c e s  level  the  between  the  governments, of  major  federal  and  government,  the  i t  is  split  between  which  participated  organizations  the  two in  Crow R a t e d e b a t e .  In  1980  organizations  there in  were  literally  Canada.  hundreds  However,  in  t h e Crow R a t e d e b a t e , t h e o r g a n i z a t i o n s  change  coalesced  two  umbrella  farm  prairie  during  around  of  Canada  affected  organizations:  W e s t e r n A g r i c u l t u r a l C o n f e r e n c e (WAC)  and  the P r a i r i e  by the  Farm  Commodity C o a l i t i o n ( P F C C ) .  The  Western  initially farm was  formed  Agricultural i n 1935  organizations  to  comprised of  45  prairie  wheat  three  federations: Manitoba these  Farm  the  to coordinate  influence  different pools  Saskatchewan  Bureau  s i x organizations  Conference  and WAC  e f f o r t s of  government farm  groups  and  the  Federation  Unifarm could,  in  various WAC  including  the  three of  was  policy.  prairie  Agriculture,  Alberta.  and d i d , c l a i m  r e p r e s e n t e d e v e r y f a r m e r on t h e p r a i r i e s .  - 235 -  (WAC)  Through that i t  In which  January, called  difference Rate,  This  railways  the  federal  between what  recognized  of  on  and what  Rate.  can  1980 WAC a g r e e d o n a new Crow R a t e p o l i c y  t h e producer  the railways  was  lost  a significant  not only should  government  railway  paid,  moving  policy losses  be r e i m b u r s e d  to under  change  two c r o p y e a r s ,  i n that i t  but also  f o r these  t h e Crow  i t a t t h e 'Crow  that  losses.  be no d o u b t t h e i m p a c t o f l o s t o r d e f e r r e d the previous  pay t h e  had i n f l u e n c e d  There  4 6  grain this  the  sales, revised  position.  The  Prairie  Farm Commodity  when  the  mid-70s  and  a number o f c o m m o d i t y g r o u p s b e g a n t o meet  transportation  the Palliser  C o a l i t i o n (PFCC) b e g a n i n  problems.  adopted  the  expanded  i t s membership  goal Crow  name  Wheat  By  Prairie  1978 Farm  In  4 7  terms  of  t o reform  membership  Alberta.  PFCC m e m b e r s h i p was c o n s i d e r a b l y  but  associations,  formally Coalition,  a  principal  the existing t h e PFCC  mostly  was  located i n  less  than  WAC  i n Table 13: Farm Organizations in the Crow Rate Debate  PFCC met w i t h  t h e Coal  Association  strengthen  i t s e f f o r t s t o persuade  to  with  deal  to discuss  group  as  by  indicated  Association  Commodity  dominated  as  the cattle  the  and e s t a b l i s h e d  t h e development o f a proposal rates.  Growers  rail  mainline  - 236 -  i n early  the federal capacity  1981 t o  government  and  reform  of  the  Crow R a t e .  This  led  to  the  F o r c e on C a n a d a ' s C r i s i s  in Rail  thus  only  but  successful a l s o was  national WAC  issue.  Two  This  of  the  Transportation.  increasing  i n making  countered  the  the  PFCC  i t s support  Crow R a t e  strong  Task was base  debate  base c l a i m e d  a by  Canada.  smaller each  not  successful  in prairie  because  in  formation  organizations  played  significant  need  to  be  identified  roles  in  the  Crow  Rate  debate.  As major  already  transformation  agriculture  by  demonstrated accurately the  trend  dramatic grain 80  indicated,  the  towards decrease  cent  at of  in  overall 30  number per  product.  become d i v i d e d b e t w e e n two  cent  As  extremes.  a  undergone  political of  WAC  could  s i n g l e group.  l a r g e r farms  present, the  community a  had  the  formation  farm  ever  prairies  changed  The  c h a r a c t e r i z e d as  sector,  per  which  1980.  that  the  was  no In  and  farms.  in In  farms  result  farmers  - 237  -  the the  produce  end i s :  ...the capital i n t e n s i v e farmer. His selfconception of farmer-businessman operating in the g r a i n s i n d u s t r y or the c a t t l e i n d u s t r y f o r p r o f i t moves h i m t o i d e n t i f y more c l o s e l y w i t h non-farm components of h i s commodity a r e a . He becomes a p a r t n e r o f t h e a g r i b u s i n e s s s e c t o r o f the food i n d u s t r y . 4 8  be  addition,  of the  A t one  of PFCC  longer  resulting  of  map  a  have  Those capital  farmers  intensive  traditional numbers  Roy  the  agriculture  (NFU) to  marketing  boards,  bargaining  rights  the  "NFU  i n t h e mid large  rallies  L a n g s p o k e on  1969  Palliser  and  opposed  based  in  the  Saskatchewan, satisfied the  Pool  one  prairies  Wheat the  undertaken  NFU  the  group  its of  by  of 5 2  Paul  most  Pross.  interventions, and  p o l i c y challenge  collective out  of O t t o Lang  they  staged  wherever  many Otto  5 1  Association  was  formed  v i r t u a l l y a l l issues. Triangle  was  region  initially  of  in  Largely southern  comprised  of  dis-  Pool  who  believed  members),  Palliser  change.  size  (4,000  effective  influencing This  under  M i t c h e l l points  S a s k a t c h e w a n Wheat  small  the  policy.  Don  in  National  1969,  demonstrations  on  the  "state  5 0  Growers  Palliser  i n terms  transport  grain  slow i n adopting  Despite became  farmers.  tractor  members o f was  stabilization  the  diminishing  in  price  towards  maintained  result  for...  prairies".  The  a  t h e i r m a i n theme, and  and the  As  4 9  move  were  reorganized  the  1970s as  which  fight  for  used  and  populism,  mid-1960s.  Union  Atkinson,  that  resisted , this  anti-monopoly  by  Farmers  which  i s also Pross  - 238  -  organizations  federal  on  agricultural  borne out identifies  by  an those  the and  analysis groups  which  possess  commensurate knowledge and  human  of  of  sectors  as  influence  (who  organizations  Canada G r a i n s  T a b l e 14:  It  5 3  as  and  an  that is  extensive  and  affect  rank the  in  analysis  Palliser  cohesion,  resources,  government t h a t  i n Canadian farm  such  discussed,  of  institutions  undertook  groups  continuity  financial  effectiveness."  Forbes  already  and  those  their clients  terms Jim  "...organizational  this of  a n o t h e r Lang e n d o r s e d  highest  category  in that  institutions  food  Wheat  them  policy)  Growers  and  places  and,  as  organization,  the  Council.  Farm O r g a n i z a t i o n s  Western A g r i c u l t u r a l Conference Organization  and  t h e Crow R a t e .  (WAC):  Membership  U n i t e d G r a i n Growers UNIFARM Saskatchewan F e d e r a t i o n of Agriculture T h r e e P r a i r i e Wheat P o o l s  1980  90,000 30,000 30,000 150.000 300,000  Crow P o s i t i o n D i r e c t Government s u b s i d y to R a i l w a y s . Producers to pay n e g o t i a t e d s h a r e of inflation.  P r a i r i e Farm Commodity C o a l i t i o n (PFCC): Organization  Membership  A l b e r t a C a t t l e Commission B a r l e y Growers F l a x Growers Palliser Rapeseed A s s o c i a t i o n s Sask. S t o c k Growers Manitoba C a t t l e Associations A l b e r t a Hog P r o d u c e r s  - 239  42,000 1,000 500 2,200 1,650 8,000 12,000 1.000 68,350  -  Crow P o s i t i o n P r o d u c e r s t o pay r a i l w a y f u l l c o s t s . Government to pay s u b s i d y d i r e c t l y t o producers.  National  Farmers Union:  Organization  Membership  W e s t e r n Wing  Crow P o s i t i o n  4,000  On t h e n a t i o n a l  R e t a i n 1899 r a t e and no subsidy to Railways  f r o n t PFCC  received  support  90,000 member C a n a d i a n C a t t l e m e n ' s A s s o c i a t i o n to  i t s support  such  as c o a l ,  from potash  the various and s u l p h u r  Task F o r c e on Canada's C r i s i s received in  but,  - t h e Canadian  as t i m e w i l l  influential the  take and  commodity  associations  embraced under  i n Rail  and  Federation  show, t h i s  of  national  multi-regional  a stand different  organization  o r g a n i z a t i o n became t h e l e a s t  organizations  which  agriculture  WAC  o f A g r i c u l t u r e (CFA)  perspectives.  on an i s s u e  the t i t l e  Transportation.  of a l l the organizations.  weakness  broad  i n addition  support from t h e l a r g e s t a g r i c u l t u r a l  Canada  from the  This  demonstrates  which When  represent forced  affects different  sectors,  t h e CFA  to  regions  was  rendered  support  from t h e  helpless.  The Canadian  National Labor  Farmers  Congress  i n w h a t i t saw a s a c l a s s  Union which  received provided  struggle.  - 240 -  financial  support  However, t h e key Wheat  Pool  (SWP)  with  as t h e  prairies*  to  provincial  the  the Pool  Lang  Wheat to  result, on  g o v e r n m e n t and  was  to  Pool  the  Pool  the  Lang  over  Mr.  access  Crow  who  who  agreed  reform.  side  could  certainly  that  that i t him As  5 5  to c o n t r o l the  opposition  to his  gives  5 4  opposed  Rate  i t difficult Turner's  de