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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 DEVELOPMENT OF NATIONAL TRANSPORTATION POLICY LESSONS FROM CHANGES TO THE CROW RATE By HENRY ROPERTZ A THESIS SUBMITTED IN PARTIAL FULFILLMENT OF THE REQUIREMENTS FOR THE DEGREE OF DOCTORATE OF PHILOSOPHY i n 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 S t u d i e s We a c c e p t t h i s t h e s i s as c o n f o r m i n g t o t h e r e q u i r e d s t a n d a r d THE UNIVERSITY OF BRITISH COLUMBIA October 1989 (cJHenry R o p e r t z , 1989 I n p r e s e n t i n g t h i s t h e s i s i n p a r t i a l f u l f i l m e n t o f t h e r e q u i r e m e n t s f o r an advanced degree a t t h e U n i v e r s i t y o f B r i t i s h C o lumbia, I agree t h a t t h e L i b r a r y s h a l l make i t f r e e l y a v a i l a b l e f o r r e f e r e n c e s and s t u d y . I f u r t h e r agree t h a t p e r m i s s i o n f o r e x t e n s i v e c o p y i n g o f t h i s t h e s i s f o r s c h o l a r l y p u r p o s e s may be g r a n t e d by t h e head o f my department o r by h i s o r h e r r e p r e s e n t a t i v e s . I t i s u n d e r s t o o d t h a t c o p y i n g o r p u b l i c a t i o n o f t h i s t h e s i s f o r f i n a n c i a l g a i n s h a l l n o t be a l l o w e d w i t h o u t my w r i t t e n p e r m i s s i o n . Department o f I n t e r d i s c i p l i n a r y S t u d i e s The U n i v e r s i t y o f B r i t i s h Columbia 1956 M a i n M a l l Vancouver, B.C. V6T 1Y3 Date O c t o b e r , 1989 A B S T R A C T Canada i s a c o n f e d e r a t i o n c o m p r i s e d of e l e v e n governments, one f e d e r a l and t e n p r o v i n c i a l . T h i s Canadian s t y l e of f e d e r a l i s m i s r e l a t i v e l y u n i q u e i n i m p o r t a n t a s p e c t s . The p r o v i n c e s have c o n s i d e r a b l e power compared t o t h e f e d e r a l government and i n c r e a s i n g l y e x e r c i s e t h a t power t o i n f l u e n c e f e d e r a l p o l i c i e s . For example, each p r o v i n c i a l government has c o n t r o l over t h e r e s o u r c e base of . i t s economy. S i t u a t i o n s such as t h i s pose s p e c i a l h a n d i c a p s t o e f f e c t i v e n a t i o n a l government. T h i s t h e s i s examines t h o s e f e a t u r e s of C anadian f e d e r a l i s m and a n a l y z e s how t h e s t r u c t u r e of f e d e r a l i s m and changes t a k i n g p l a c e i n t h e s t r u c t u r e m i l i t a t e s a g a i n s t t h e development of n a t i o n a l p o l i c i e s , such as t r a n s p o r t a t i o n w h i c h are n e c e s s a r y t o s u s t a i n t h e economic u n i o n of Canada. The t h e s i s a n a l y z e s th e development of 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 w i t h i n t h e framework of t h e c h a n g i n g s t r u c t u r e o f f e d e r a l i s m . The f o c u s i s a comprehensive a n a l y s i s o f t h e f e d e r a l government's p o l i c y t o change t h e A B S T R A C T Crow R a t e . The a n a l y s i s u n d e r t a k e n i s a l o n g i t u d i n a l s t u d y of t h e Crow Rate over a t e n - y e a r p e r i o d w i t h emphasis on t h e p e r i o d between 1980-1983. To s u b s t a n t i a t e t h e arguments, p a r t i c u l a r a t t e n t i o n was p a i d 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. I n c l u d e d as p a r t of t h e a n a l y s i s was a t i m e - s e r i e s r e v i e w of t h e p e r s o n a l w o r k i n g papers of Jean-Luc P e p i n , M i n i s t e r of T r a n s p o r t , 1980-1983. An impact m a t r i x was c o m p i l e d t o show how d i f f e r e n t s e c t o r s and i n t e r e s t groups were a f f e c t e d by Crow Rate change and how t h e s e d i f f e r e n c e s i n f l u e n c e d p u b l i c o p i n i o n . An " I n s i d e - O u t s i d e A c c e s s Model" was i n t r o d u c e d t o d e s c r i b e a somewhat unique approach f o r Canada t h a t was t a k e n t o r e a c h a c o n c l u s i o n on Crow Rate r e f o r m , g i v e n t h e e x i s t i n g c o n s t r a i n t s . The major c o n t r i b u t i o n o f t h e t h e s i s i s t h a t i t d e m o n s t r a t e s 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 f e d e r a l i s m and i n t e r e s t group a c t i o n c o n s t r a i n changes i n n a t i o n a l p o l i c y . i i i A B S T R A C T The i n t e n s i t y of o p p o s i t i o n may w e l l be p r i m a r i l y r o o t e d i n t h e economic i n t e r e s t s and t h e t r a d i t i o n s of i m p o r t a n t groups i n s o c i e t y , but t h e e x i s t e n c e of a Canadian type of f e d e r a l system g i v e s t h o s e groups an a d d i t i o n a l l e v e l of government t h a t can be m o b i l i z e d t o d e f e n d t h e i r i n t e r e s t s . Moreover, p r o v i n c i a l governments o f t e n r e i n f o r c e t h e f e a r s of t h e p o p u l a t i o n and i n t e r e s t g r oups, p r o v i d e s t r a t e g i c l e a d e r s h i p f o r t h e i r p r o t e s t s and bestow l e g i t i m a c y on t h e r e s i s t a n c e t o change. A c o a l i t i o n of p o w e r f u l i n t e r e s t groups and t h e i r p r o v i n c i a l governments i s a p o t e n t f o r c e a f f e c t i n g n a t i o n a l p o l i c y -making, even i n a r e a s of e x c l u s i v e f e d e r a l j u r i s d i c t i o n such as t h e Crow Rate. i v TABLE OF CONTENTS Page Abstract Table of Contents L i s t of Tables L i s t of Figures L i s t of Maps L i s t of Appendicies Acknowledgements Chapter One: Introduction 1.0 T h e s i s Approach 1 1.1 Scope o f T h e s i s 3 1.2 C o n t e x t o f T h e s i s 10 1.3 S y n o p s i s o f T h e s i s 14 Chapter Two: The Role of Public Policy Formulation i n the Canadian P o l i t i c a l System 2.0 I n t r o d u c t i o n 2 0 2.1 Main I n s t i t u t i o n s o f Canadian P o l i t i c s 22 2.1.1 F e d e r a l i s m 22 2.1.2 Models o f F e d e r a l i s m 31 2.1.3 C a b i n e t System 36 2.1.4 R o l e o f t h e C e n t r a l A g e n c i e s 53 2.1.5 R o l e o f I n t e r e s t Groups 60 2.1.6 R o l e o f t h e Media 65 2.1.7 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 68 Chapter Three: The Development of National Transportation Policy 3.0 I n t r o d u c t i o n 82 3.1 The Canadian T r a n s p o r t a t i o n System 83 3.1.1 R a i l w a y I d e o l o g y 85 3.1.2 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 89 3.1.3 R a i l w a y Development 95 3.1.4 Highway T r a n s p o r t a t i o n 115 3.1.5 T r a n s p o r t P o l i c y Development 123 Chapter Four: Crow Rate as an Issue 4.0 I n t r o d u c t i o n 173 4.1 Crow Rate H i s t o r i o g r a p h y 174 4.1.1 P e r i o d t h e Crows Nest Pass R a t e s 187 were i n E f f e c t i i v v i i v i i i i x x x i v TABLE OF CONTENTS Page 4.1.2 Replacement o f Crows Nest Pass R a t e s 190 by S t a t u t o r y R a tes 4.1.3 I m p l i c a t i o n s o f t h e 1897 Agreement 194 4.2 P e r i o d o f U n c e r t a i n t y (1960-1980) 198 4.2.1 The B o l d Approach 211 4.3 P e r i o d o f Change (1980-1984) 228 4.4 The C o n f l i c t s 234 4.4.1 S e c t o r a l D i f f e r e n c e s 2 35 4.4.2 I n t e r g o v e r n m e n t a l C o n f l i c t 250 4.4.3 I n t r a g o v e r n m e n t a l C o n f l i c t 255 Chapter Five: Strategy Development and Negotiation i n Canadian Federalism 5. 0 I n t r o d u c t i o n 267 5. 1 C o n t e x t 268 5. 2 N e g o t i a t i o n i n a F e d e r a l S t a t e 270 5. 2. 1 P o l i c y F o r m u l a t i o n (The 'Pepin ' Approach) 270 5. 2. 2 I n t e r e s t Groups 276 5. 2. 3 R o l e o f t h e Media 281 5. 2. 4 Consensus f o r Change 285 5. 3 P o l i c y N e g o t i a t i o n i n a F e d e r a l S t a t e 300 5. 3. 1 Appointment o f F e d e r a l N e g o t i a t o r 300 5. 3. 2 P u b l i c Awareness o f t h e Crow Rate 309 5. 3 . 3 On-Farm Awareness Study 313 5. 3 . 4 G i l s o n R e p o r t 321 5. 3. 5 I n t e r and I n t r a C o n f l i c t s 327 5. 3. 6 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 335 5. 4 P a r l i a m e n t a r y P r o c e s s 337 5. 4. 1 P r e l u d e t o L e g i s l a t i o n 338 5. 4. 2 B i l l C-155 345 5. 4. 3 Western G r a i n T r a n s p o r t a t i o n A c t 356 5. 5 I n s i d e - O u t s i d e A c c e s s Model f o r P o l i c y 357 N e g o t i a t i o n / F o r m u l a t i o n Chapter Six: Summary and Conclusions 6.0 Summary o f T h e s i s 372 6.1 C o n c l u s i o n s 384 6.2 F u t u r e R e s e a r c h 385 v i LIST OF TABLES NO. Paae 1 The L i b e r a l s i n Saskatchewan, 1968-1988 48 2 R a i l w a y C o n s t r u c t i o n , 1906-1985 97 3 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 105 1930-1985 4 Changes i n A g r i c u l t u r a l S o c i e t y , 1960-1980 106 5 S t a t u s o f R a i l w a y M i l e a g e , 1975-1979 111 6 L i s t of T r a n s p o r t a t i o n P r o p o s a l s made by 150 Western P r e m i e r s at WEOC (1973) 7 F e d e r a l Government T r a n s p o r t Programs and 151 P o l i c i e s Emanating out of WEOC (1973) 8 F e d e r a l - P r o v i n c i a l Committee on Western 161 T r a n s p o r t a t i o n Committee of M i n i s t e r s ' M e e t i n g - Agenda (1974) 9 Changes t o t h e Crow Rate Agreement, 1897-1983 191 10 G r a i n E x p o r t Volume and P r i c e , 1883-1985 196 11 The Canadian G r a i n P r o d u c t i o n , H a n d l i n g 209 and T r a n s p o r t a t i o n System, 1980 12 Cost of Moving G r a i n by R a i l 1974, 1977, 1980 227 13 Farm O r g a n i z a t i o n s and the Crow Rate Debate 239 14 Membership of G r a i n H a n d l i n g C o o p e r a t i v e s 246 1959 t o 1981 15 Summary of B a s i c P o s i t i o n s on Crow R a t e , 1980 274 16 P e p i n P l a n f o r Crow Rate Reform 296 17 R e g i o n a l D i s t r i b u t i o n of Economic Impacts of 299 the R a i l w a y Investment P l a n s 18 F i n a n c i a l P o s i t i o n s : G r a i n H a n d l i n g 302 Companies, 1980 19 P r o d u c e r Guarantees 304 20 P e p i n ' s Communication S t r a t e g y , 1982 308 21 Crow B e n e f i t Payment O p t i o n s 328 22 P o s i t i o n s of A g r i c u l t u r a l O r g a n i z a t i o n s : 334 Method o f Payment 23 F e d e r a l O u t l a y 1982-83 t o 1985-86 335 v i i LIST OF FIGURES No. Page 1 P r o c e s s of C a b i n e t A p p r o v a l 59 2 F e d e r a l and P r o v i n c i a l Powers 91 3 B r a n c h l i n e R i v a l r y 102 4 G r a i n and F l o u r E x p o r t Rates 182 5 G r a i n Volumes and P r i c e of Wheat, 1974-1985 269 6 B u l k E x p o r t s t h r o u g h t h e M o u n t a i n s , 1960-1990 292 7 I n s i d e - O u t s i d e A c c e s s Model 359 v i i i LIST OF MAPS Page Crow's Nest Pass R a i l w a y 183 i x 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 Nest Pass - June 29, 1897 The Crow's Nest Pass Agreement, September 06, 1897 C o m p i l a t i o n o f E d i t o r i a l s from M a j o r Western Newspapers, 1981-82 F e d e r a l Government P o l i c y Statement, 1982 An Example o f Advocacy A d v e r t i s i n g d u r i n g t h e Crow Rate N e g o t i a t i o n s , March 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 , 1982 x A C K N O W L E D G E M E N T S A t h e s i s i s never the product of one person. In r e s e a r c h i n g and w r i t i n g t h i s t h e s i s , I have r e c e i v e d a l e v e l of c o o p e r a t i o n and support t h a t one always hopes f o r but can never r e a l l y expect. F i r s t , I acknowledge Denise Jones who typed the c o u n t l e s s number of d r a f t s of t h i s t h e s i s . Her w i l l i n g n e s s to take on t h i s j o b and her b e l i e f i n me was a major f a c t o r i n encouraging me to complete the u n d e r t a k i n g . Second, I acknowledge my t h e s i s A d v i s o r s whose p a t i e n c e , guidance and commitment p r o p e l l e d me to c a r r y on even when the c h a l l e n g e seemed i m p o s s i b l e . T h i r d , I acknowledge the Honourable Jean-Luc Pepin whose i n s p i r a t i o n p r o v i d e d me w i t h the impetus to launch t h i s p r o j e c t . F o u r t h , I acknowledge F r e d Anderson whose h i g h s t a n d a r d of i n t e g r i t y became my o b j e c t i v e i n attempting to i d e n t i f y the l e s s o n s l e a r n e d from changes to the Crow Rate. F i n a l l y , I acknowledge my c o l l e a g u e s and peers from the t r a n s p o r t a t i o n i n d u s t r y who p r o v i d e d both i n s i g h t and made a v a i l a b l e data i n support of my t h e s i s . x i CHAPTER ONE I N T R O D U C T I O N 1.0 Thesis Approach The argument of t h i s t h e s i s i s t h a t t h e changing n a t i o n a l s t r u c t u r e of f e d e r a l i s m m i l i t a t e s a g a i n s t t h e development o f n a t i o n a l p o l i c i e s such as t r a n s p o r t a t i o n . To s u b s t a n t i a t e t h e argument, a t e n - y e a r l o n g i t u d i n a l s t u d y i s u n d e r t a k e n of t h e f e d e r a l government's e f f o r t t o change t h e r a i l f r e i g h t r a t e on g r a i n ( t h e Crow R a t e ) . The r e s e a r c h i n t o t h e s t r a t e g i e s and p o l i c i e s used t o b r i n g about changes i n t h e Crow Rate e n a b l e s t h e f o r m u l a t i o n of a t r a n s p o r t a t i o n p o l i c y development model. The d i v e r s e i n t e r e s t needs of p r o v i n c i a l governments and p r e s s u r e groups a re accounted f o r i n t h e model. The t h e s i s d emonstrates t h a t t h i s model i s c o n s i s t e n t w i t h t he p r o c e s s t h a t s u c c e s s f u l l y brought changes t o t h e Crow Rate. I n t e r e s t i n g l y t h e r e have been no s y s t e m a t i c s t u d i e s - 1 -u n d e r t a k e n o f 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 development i n Canada w i t h an emphasis on 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 . Nor have t h e r e been any s t u d i e s u n d e r t a k e n w h i c h o u t l i n e t h e p r o c e s s of p o l i c y development showing how t h e changes i n t h e p r o c e s s i t s e l f a f f e c t e d t r a n s p o r t a t i o n p o l i c y development. The t h e s i s p r o v i d e s a s y s t e m a t i c s t u d y of a 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 i s s u e i n Canada showing t h e c o n s t r a i n t s of Canada's s t y l e of f e d e r a l i s m and examines the i n t e r a c t i v e e f f e c t s between i n t e r e s t groups and f e d e r a l i s m t h r o u g h t h e development of a p o l i c y f o r m u l a t i o n model. The t h e s i s o u t l i n e s t h e r e l a t i v e l y u n i q u e f e a t u r e s of Canadian f e d e r a l i s m and d e m o n s t r ates how t h e s e c h a r a c t e r i s t i c s pose s p e c i a l h a n d i c a p s t o e f f e c t i v e n a t i o n a l government. I n s u p p o r t o f t h e t h e s i s , a c a s e s t u d y o f a major p o l i c y i n i t i a t i v e i s u n d e r t a k e n t o demonstrate t h e problems w h i c h c o n f r o n t Canadian f e d e r a l i s m i n f o r m u l a t i n g - 2 -n a t i o n a l p o l i c i e s i n t h e f a c e of c o n f l i c t i n g p r o v i n c i a l i n t e r e s t s . I n b r o a d e r terms, t h e f r a g m e n t a t i o n of a u t h o r i t y -i m p l i c i t i n a f e d e r a l system makes change i n g e n e r a l more d i f f i c u l t , i n c r e a s i n g t h e l e v e l o f consensus r e q u i r e d b e f o r e major new p o l i c i e s can be i n t r o d u c e d , and i n c l i n i n g t h e p o l i t i c a l system i n Canada more f i r m l y towards an i n c r e m e n t a l i s t p a t t e r n of p o l i c y a d j ustment. 1.1 Scope o f T h e s i s The t h e s i s p r o v i d e s a t e n - y e a r l o n g i t u d i n a l case s t u d y of t h e Crow Rate. P a r i c u l a r emphasis i s de v o t e d t o exam i n i n g t h e r o l e o f i n t e r e s t group a c t i v i t y i n i n t e r -g o vernmental n e g o t i a t i o n s . The t h e s i s examines t h e degree t o w h i c h t h e ch a n g i n g s t r u c t u r e o f Canadian f e d e r a l i s m m i l i t a t e s a g a i n s t t h e development o f 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 i e s . Canada i s a c o n f e d e r a t i o n c o m p r i s e d o f e l e v e n governments, one f e d e r a l and t e n p r o v i n c i a l . Each l e v e l o f government has i t s own unique powers and r e s p o n s i b i l i t i e s The Constitution Act, 1867 g i v e s t h e p r o v i n c e s unique j u r i s d i c t i o n a l a u t h o r i t y i n f u n c t i o n a l a r e a s o f expanding - 3 -s i g n i f i c a n c e such as h e a l t h , e d u c a t i o n and, most i m p o r t a n t , g i v e s them c o n t r o l over t h e n a t u r a l r e s o u r c e base of t h e i r economy. However, r e s p o n s i b i l i t y f o r n a v i g a t i o n and s h i p p i n g as t r a n s p o r t a t i o n was e x p l i c i t l y d e f i n e d i n 1867 was g r a n t e d t o t h e f e d e r a l government. The c o u r s e of t r a n s p o r t p o l i c y s i n c e C o n f e d e r a t i o n has c e n t e r e d on r a i l w a y development as a key component of n a t i o n a l p o l i c y . Roads e v o l v e d under p r o v i n c i a l j u r i s d i c t i o n . Now, a r g u a b l y t h e most i m p o r t a n t mode i s not under e x c l u s i v e f e d e r a l c o n t r o l . The p r o v i n c e s v a r y s i g n i f i c a n t l y i n g e o g r a p h i c a l s i z e , p o p u l a t i o n and economic s t r u c t u r e , d e v o t i o n t o s o c i a l programs and, as i n Quebec, even a d i f f e r e n t l e g a l system. C o n c o m i t a n t l y , t r a n s p o r t a t i o n c h a r a c t e r i s t i c s such as l e v e l of c o m p e t i t i o n , a v a i l a b i l i t y of i n f r a s t r u c t u r e and c o m m e r c i a l v i a b i l i t y a l s o v a r y s i g n i f i c a n t l y from p r o v i n c e t o p r o v i n c e . A c c o r d i n g t o t h e Macdonald R o y a l Commission on Economic U n i o n and Development P r o s p e c t s f o r Canada, th e economic and s o c i a l u n i o n o f Canada depends on t h e development of n a t i o n a l p o l i c i e s based on f a c t o r s such as e q u i t y , e f f i c i e n c y , c o s t e f f e c t i v e n e s s and r a t i o n a l i t y . 1 However t h e c o n f l i c t between f e d e r a l and p r o v i n c i a l - 4 -governments, w h i c h has been an e n d u r i n g i n g r e d i e n t of n a t i o n a l p o l i c y c o o p e r a t i o n and c o m p e t i t i o n s i n c e C o n f e d e r a t i o n , has made t h e a t t a i n m e n t o f p u b l i c g o a l s d i f f i c u l t . Today Canadian p r o v i n c e s have c o n s t i t u t i o n a l and economic a u t h o r i t y e q u a l t o t h a t u s u a l l y a s s o c i a t e d w i t h s o v e r e i g n s t a t e s . Government i n Canada has become d e c e n t r a l i z e d t o a g r e a t e r e x t e n t t h a n i n a l l o t h e r i n d u s t r i a l i z e d n a t i o n s , e x c e p t perhaps S w i t z e r l a n d . The p r o v i n c e s c o n t i n u e t o compete w i t h t h e f e d e r a l government f o r b r o a d e r j u r i s d i c t i o n a l powers, a c o n f r o n t a t i o n t h a t was not r e s o l v e d w i t h t h e Constitution Act, 1982. As w e l l , t h e p r o v i n c e s t e n d t o compete w i t h each o t h e r f o r economic development and, as a r e s u l t , r e s i s t f e d e r a l government i n i t i a t i v e s whenever t h e l a t t e r i s a t t e m p t i n g t o r a t i o n a l i z e o r reduce i t s e x p e n d i t u r e s i n a p a r t i c u l a r p r o v i n c e - even when t h e r e i s sound economic argument f o r such change. I n t u r n Canadians have been c o n d i t i o n e d by t h e i r r e s p e c t i v e P r e m i e r s t o r e s i s t n a t i o n a l p o l i c y - m a k i n g , u n l e s s t h e i r own p r o v i n c e can be i d e n t i f i e d as a w i n n e r . The s h a r i n g of powers between governments i s not t h e o n l y d i s t i n c t f e a t u r e of Canadian F e d e r a l i s m . On a c o n c u r r e n t b a s i s t h e p u b l i c p o l i c y - m a k i n g p r o c e s s has changed. The i n s t i t u t i o n a l i z a t i o n of governments i n - 5 -Canada, s u p p o r t e d by p o l i t i c a l and b u r e a u c r a t i c e n t i t i e s o f growing s i g n i f i c a n c e , has reduced o r made more d i f f i c u l t t h e r o l e of governmental groups and i n d i v i d u a l s i n p o l i c y f o r m u l a t i o n . I n a d d i t i o n t h e concept o f C a b i n e t s o l i d a r i t y a t t h e f e d e r a l l e v e l has changed t h e r o l e o f " r e g i o n a l " m i n i s t e r s w i t h t h e r e s u l t t h a t t h i s once t r a d i t i o n a l r o l e has been f i l l e d t o d a y by p r o v i n c i a l governments o r , more s p e c i f i c a l l y , p r o v i n c i a l P r e m i e r s . The r e s u l t has been t h e c r e a t i o n o f a f e d e r a l s t a t e t h a t i s d e c e n t r a l i z e d not i n terms of g r e a t e r i n p u t a t t h e l o c a l and r e g i o n a l l e v e l s i n t o n a t i o n a l d e c i s i o n - m a k i n g , but more i n terms of t h e development of s t r o n g p r o v i n c i a l systems w i t h t h e i r own j u r i s d i c t i o n . T h i s " b a l k a n i z a t i o n " r a i s e s t h e q u e s t i o n of t h e a b i l i t y of t h e f e d e r a l government t o d e v e l o p n a t i o n a l p o l i c i e s and programs t h a t can s u s t a i n t h e economic u n i o n of Canada. T h i s s i t u a t i o n has never been f u l l y u n d e r s t o o d by Canadians y e t i t r e p r e s e n t s realpolitik i n t h i s c o u n t r y . The c o n s t a n t problem o f Canada's d i v e r s i t y o f r e g i o n s , i n t e r w o v e n w i t h t h e e v e r i n c r e a s i n g a m b i t i o n o f p r o v i n c i a l governments, t h e changes i n t h e s t r u c t u r e o f l a b o u r and t h e c u r r e n t debates on f r e e t r a d e , energy and 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 d e s e r v e c l o s e e x a m i n a t i o n . R e s o l u t i o n - 6 -o f each o f t h e s e a r e a s r e q u i r e s renewed f e d e r a l - p r o v i n c i a l c o o p e r a t i o n and agreement. The debate over each of t h e s e i s s u e s has begun t o f o c u s on the c o n f l i c t i n g g o a l s among the t e n p r o v i n c e s as compared t o t h e t r a d i t i o n a l 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 . The debates have a l s o d e m o n s t r a t e d t h a t r e g i o n a l i s m i s i n d e c l i n e and r e g i o n a l p o s i t i o n s a r e more l i k e l y t o be r e p r e s e n t e d as p r o v i n c i a l g o a l s and o b j e c t i v e s . The i s s u e s of f r e e t r a d e and energy are i r r e g u l a r i s s u e s on t h e p u b l i c agenda but t r a n s -p o r t a t i o n i s a q u e s t i o n t h a t has been d i s c u s s e d on an on-going b a s i s , w i t h emotion, f o r over a hundred y e a r s . R i c h a r d Simeon's c l a s s i c model of f e d e r a l i s m i s p r e d i c a t e d on a d i v i s i o n of l a b o u r i n w h i c h t h e f e d e r a l government i s r e s p o n s i b l e f o r n a t i o n a l i s s u e s and t h e u n i t 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 . 2 I n Canada t h e r e i s a fundamental imbalance i n t h e p r o c e s s . P r o v i n c e s a re f r e e t o 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 t h e c e n t r a l government i s r e l u c t a n t t o have a s i m i l a r v o i c e i n p r o v i n c i a l t r a n s p o r t a t i o n p o l i c i e s w h i c h , as w i l l be argued i n t h i s t h e s i s , a re e q u a l l y r e l e v a n t t o n a t i o n a l economic development. To examine t h e t h e s i s i t was n e c e s s a r y t o f o c u s on a complex r e g i o n a l problem, w i t h i n t h e a r e a o f f e d e r a l - 7 -j u r i s d i c t i o n , w h i c h r e q u i r e d a major change i n p o l i c y -t h r o u g h w h i c h t h e p r o v i n c e s a f f e c t e d would a c t u a l l y b e n e f i t e c o n o m i c a l l y y e t f i n d t h e m s e l v e s o p p o s i n g th e f e d e r a l i n i t i a t i v e because of t h e p o l i t i c a l p r e s s u r e s g e n e r a t e d i n Canada's s t y l e o f f e d e r a l i s m . The f e d e r a l government's d e c i s i o n t o change the l e v e l o f f r e i g h t r a t e s t o move g r a i n by r a i l (The Crow Rate) was such a complex and i n t e r - p r o v i n c i a l i s s u e . A l t h o u g h t h i s t h e s i s p r o v i d e s a h i s t o r i c a l p e r s p e c t i v e , emphasis i s p l a c e d on t h e p e r i o d between 1980 and 1983, t h e p e r i o d over w h i c h th e Crow Rate was debated and new l e g i s l a t i o n f i n a l l y e n a c t e d . The Crow Rate (a f i x e d r a i l f r e i g h t r a t e on e x p o r t g r a i n i n t r o d u c e d i n 1898 and 1899 and c o n f i r m e d by P a r l i a m e n t i n 1925) p r o v i d e d s t a b l e t r a n s p o r t a t i o n c o s t s f o r p r a i r i e g r a i n p r o d u c e r s . However t h e l o n g e v i t y of t h e Crow Rate was u n i q u e i n t h e w o r l d of t r a n s p o r t a t i o n and i t s c o n t i n u a t i o n r e p r e s e n t e d : (1) an e v e r - i n c r e a s i n g burden on t h e r a i l w a y s ; (2) an i n h i b i t i n g f a c t o r f o r t h e d i v e r s i f i c a t i o n o f t h e w e s t e r n a g r i c u l t u r a l s e c t o r and an impediment t o f u r t h e r p r o c e s s i n g a c t i v i t i e s i n t h e p r a i r i e s ; and f i n a l l y (3) an i n v e s t m e n t vacuum i n t o w h i c h the p u b l i c p u r s e was b e i n g drawn deeper and deeper t h r o u g h ad hoc f e d e r a l government s u b s i d i e s and c a p i t a l i n v e s t m e n t programs. - 8 -D e s p i t e th e overwhelming economic arguments f o r r e s o l u t i o n o f t h e Crow Rate, change was r e s i s t e d i n v a r y i n g degrees by a l l t h r e e p r a i r i e p r o v i n c i a l governments i n c l u d i n g a p r o v i n c e h a r d l y a f f e c t e d by i t a l l - Quebec. The conundrum of t h e f e d e r a l government was t o f i n d a way t o d e a l w i t h t h i s s e r i o u s , complex, p o l i t i c a l , " r e g i o n a l " and economic problem i n a n a t i o n a l c o n t e x t g i v e n t h e e x i s t i n g c o n s t r a i n t s of t h e f e d e r a l s t a t e . As i n d i c a t e d , t h e problem of the Crow Rate i s but one o f many s i m i l a r problems the f e d e r a l government w i l l be f a c i n g i n t h e y e a r s t o come. T h e r e f o r e i t i s i m p o r t a n t t o f o c u s a t t e n t i o n on t h e c o n s t r a i n t of f e d e r a l i s m and, t h r o u g h t h e r e s o l u t i o n of t h e Crow R a t e , document how t h e s e c o n s t r a i n t s were add r e s s e d and t o a s s e s s t h e impact of t h e r e f o r m p o l i c y on the g r a i n t r a n s p o r t s e c t o r . The l e s s o n s t o be l e a r n e d from t h e Crow Rate debate w i l l be o f i n t e r e s t t o d e c i s i o n - m a k e r s and t h o s e a f f e c t e d by n a t i o n a l p o l i c y . To u n d e r s t a n d t h e i s s u e o f t h e Crow Rate r e q u i r e s knowledge o f t h e g e o g r a p h i c a l r e a l i t y o f Canada. The ways i n w h i c h t e r r i t o r i a l l y - d e r i v e d i s s u e s a r e r e s o l v e d i s c r u c i a l t o t h e economic u n i o n of Canada. T h i s i s t r u e t o d a y and w i l l be so i n t h e f u t u r e . - 9 -1.2 C o n t e x t o f T h e s i s Canada i s an immense c o u n t r y and i t s t e r r i t o r y r e p r e s e n t s t h e second l a r g e s t i n t h e w o r l d . I t i s c o m p r i s e d o f many d i f f e r e n t p h y s i c a l d i v i s i o n s and, as suc h , o n l y t h e most s o u t h e r n areas of t h e c o u n t r y are s u i t a b l e f o r a g r i c u l t u r e . These i n c l u d e t h e r e g i o n s around t h e c o n u r b a t i o n of T o r o n t o , w h i c h i s Canada's prime a g r i c u l t u r a l r e g i o n - h a l f t h e C l a s s 1 l a n d i s i n s o u t h e r n O n t a r i o - and t h e p r a i r i e r e g i o n w h i c h produces n e a r l y a l l o f Canada's g r a i n and o i l seed c r o p s . The p r a i r i e r e g i o n i s u n d e r g o i n g t r a n s f o r m a t i o n from a r e g i o n where a g r i c u l t u r e dominated t o one where t h e s e r v i c e s e c t o r now p r o v i d e s over t w o - t h i r d s of a l l employment. C o n t r a r y t o p o p u l a r p e r c e p t i o n , p r a i r i e Canada i s not t h e "bread-basket of t h e w o r l d " . Canada grows o n l y between 4 and 5 per c e n t of t h e w o r l d ' s wheat p r o d u c t i o n and o n l y 3 per c e n t of i t s c o a r s e g r a i n s . D u r i n g t h e p a s t t h r e e decades w e s t e r n C anadian a g r i c u l t u r e has been c h a r a c t e r i z e d by d e c l i n i n g numbers of f u l l - t i m e f a r m e r s and farms, i n c r e a s i n g farm s i z e , more s p e c i a l i z a t i o n , c o n s i d e r a b l e p r o d u c t i v e growth and much c a p i t a l - f o r - l a b o u r s u b s t i t u t i o n . "Today p r i m a r y a g r i c u l t u r e ' s s h a r e of Gross P r o v i n c i a l P r o d u c t iis 7.1 per c e n t i n M a n i t o b a , 16.6 per c e n t i n Saskatchewan and o n l y 4.5 per c e n t i n A l b e r t a " . 3 T h i s i s not t o s t a t e t h a t - 10 -g r a i n p r o d u c t i o n i s not i m p o r t a n t t o Canada - i t i s - $5 b i l l i o n i n annual s a l e s i s s i g n i f i c a n t and r e p r e s e n t s one of Canada's major s o u r c e s of c o n t r i b u t i o n t o a b a l a n c e d e x p o r t t r a d e s i t u a t i o n . Based on t h e above t r e n d s , the a g r i c u l t u r e s e c t o r of t h e p r a i r i e s w i l l s t e a d i l y c o n s t i t u t e a d e c l i n i n g p r o p o r t i o n of t h e p r a i r i e r e g i o n ' s o u t p u t . The p o p u l a t i o n of the p r a i r i e s ( a p p r o x i m a t e l y f o u r m i l l i o n ) r e p r e s e n t s about 16 per ce n t of t h e n a t i o n , whereas a p p r o x i m a t e l y 50 per cent o f t h e peo p l e i n Canada r e s i d e i n t h e Quebec-Windsor c o r r i d o r . T h i s c o r e of the p o p u l a t i o n i n one area has g i v e n t h a t r e g i o n c o n s i d e r a b l e w e i g h t i n n a t i o n a l d e c i s i o n - m a k i n g . As such " . . . t h e e a s t e r n and w e s t e r n p r o v i n c e s s t a n d as p e r i p h e r a l p o l i t i c a l d e pendencies of C e n t r a l Canada* and must s t r u g g l e t o o b t a i n g r e a t e r s h a r e s o f n a t i o n a l w e a l t h and i n c r e a s e d p o l i t i c a l autonomy". 4 D u r i n g t h e 1980s "...much o f c u r r e n t Canadian p o l i t i c s , i n c l u d i n g t h e C o n s t i t u t i o n i s s u e , t u r n e d on the att e m p t s of t h e p r o v i n c i a l l e v e l p o l i t i c a l 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 -g a i n more power over t h e i r economies, t o g a i n more i f not a l l , t h e b e n e f i t s from t h e i r n a t u r a l r e s o u r c e s " . 5 Con-c o m i t a n t l y , t h e t r a d i t i o n a l economic l i n k s between t h e Canad i a n p r o v i n c e s have been e r o d i n g w i t h t h e r e s u l t , i n some c a s e s , t h a t i t i s e a s i e r t o t r a d e w i t h a n other c o u n t r y t h a n w i t h a n other p r o v i n c e . F o r example "...seven p r o v i n c i a l governments have adopted narrow p r o v i n c e - f i r s t procurement p o l i c i e s . Two governments have a c t u a l l y imposed t e n d e r i n g r e s t r i c t i o n s t h a t i n h i b i t a c c e s s t o p r o v i n c i a l c o n t r a c t s f o r Canadian s u p p l i e r s o u t s i d e t h e i r p r o v i n c e s " . 6 R i c h a r d Simeon s t a t e s t h a t " the c r i s i s of Canadian f e d e r a l i s m i s above a l l a c r i s i s i n t h e r e l a t i o n s between g o v e r n m e n t s " . 7 There a re many c o n t r a s t i n g f e a t u r e s t o Canada's n a t i o n a l t r a n s p o r t a t i o n system. There i s no n a t i o n a l bus company. The term " t r a n s c o n t i n e n t a l " as i t a p p l i e s t o r a i l w a y and a i r l i n e s means Vancouver t o T o r o n t o / M o n t r e a l . There a r e no d i r e c t a i r l i n k s between t h e c a p i t a l c i t i e s o f w e s t e r n Canada w i t h t h e c a p i t a l c i t i e s of t h e f o u r A t l a n t i c p r o v i n c e s . Thus t h e degree o f c o m p e t i t i o n and a v a i l a b i l i t y o f i n f r a s t r u c t u r e s e r v i c e s v a r i e s c o n s i d e r a b l y t h r o u g h o u t Canada. T h i s has caused s i g n i f i c a n t d e p a r t u r e s from t h e p o l i c y c o n t a i n e d i n t h e National Transportation Act (1967) w h i c h emphasized e f f i c i e n c y - 12 -and economic c o m p e t i t i o n . The Crow Rate debate reached i t s g r e a t e s t i n t e n s i t y i n t h e 1980s. 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 Prime M i n i s t e r s and i n t h e P r a i r i e s , t h e r e g i o n most a f f e c t e d by Crow Rate changes, two governments (Manitoba and Saskatchewan) changed hands. The c o u n t r y a l s o f a c e d an economic c r i s i s , an energy c r i s i s and a c o n s t i t u t i o n a l c r i s i s . * I t i s a g a i n s t t h i s background t h a t t h i s t h e s i s w i l l a n a l y z e t h e f e d e r a l government's p o l i c y t o change t h e Crow Ra t e . A c c o r d i n g t o F r e d e r i c k J . F l e t c h e r and Donald W a l l a c e "...case s t u d i e s p r o v i d e some g u i d e l i n e s i n i d e n t i f y i n g c o n d i t i o n s and s u g g e s t i n g reforms t h a t might make t h e p r o c e s s more d e c i s i v e , and more r e s p o n s i v e , as w e l l as more a b l e t o manage c o n f l i c t " . 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 S y n o p s i s o f T h e s i s To demonstrate t h i s t h e s i s , p a r t i c u l a r a t t e n t i o n w i l l be p a i d t o t h e mechanisms by which 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 re managed. There are many major i n s t i t u t i o n s o r mechanisms of Canadian p o l i t i c s w h i c h a f f e c t p u b l i c p o l i c y development. These i n c l u d e t h e C a b i n e t system, t h e f e d e r a l and p r o v i n c i a l c a u c u s e s , n a t i o n a l p a r t i e s , the f i r s t m i n i s t e r s ' c o n f e r e n c e , i n t e r e s t groups and the media. The r e s e a r c h p a r t of t h e t h e s i s w i l l , over a l o n g i t u d i n a l b a s i s , p r o v i d e a n a l y s i s of how each of t h e s e i n s t i t u t i o n s a f f e c t e d t h e Crow Rate debate b e g i n n i n g i n t h e e a r l y 1970s. Each of t h e s e i n s t i t u t i o n a l f a c t o r s were examined as each of them had a major i n f l u e n c e on the outcome of t h e Crow Rate debate. Chapter Two w i l l d i s c u s s the development of p r o v i n c e -b u i l d i n g , w i t h p a r t i c u l a r r e f e r e n c e t o t h e t h r e e p r a i r i e p r o v i n c i a l governments, and document how t h e d i f f e r e n t p o s i t i o n s of each o f t h e s e governments demonstrates t h e d e c l i n e o f t h e concept of a more g e n e r a l " p r a i r i e r e g i o n " as a f o c u s f o r economic p o l i c y p l a n n i n g . The o t h e r major i n s t i t u t i o n a l f a c t o r d i s c u s s e d was the r o l e of a f e d e r a l C a b i n e t M i n i s t e r . S i n c e the - 14 -T r a n s p o r t M i n i s t e r , The Honourable Jean-Luc P e p i n , p l a y e d such a predominant r o l e i n r e s o l v i n g t h e Crow Rate debate, h i s r o l e r e q u i r e s c r i t i c a l a n a l y s i s . C h a p t e r Two a l s o o u t l i n e s the e v o l u t i o n o f p u b l i c p o l i c y development w i t h emphasis on t h e c h a n g i n g models of f e d e r a l i s m such as c o o p e r a t i v e , e x e c u t i v e and t h e c u r r e n t c o l l a b o r a t i v e model. A l s o i n c l u d e d i s an a n a l y s i s o f t h e c e n t r a l p l a n n i n g p r o c e s s e s and s t r u c t u r e s w h i c h a f f e c t e d t h e Crow Rate debate. Chapter Three p r e s e n t s an h i s t o r i c a l r e v i e w of 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 . The c h a p t e r emphasizes t h e c o n s t r a i n t s t h a t Canadian f e d e r a l i s m imposes on t h e f e d e r a l government t o pursue e f f e c t i v e t r a n s p o r t a t i o n p o l i c y . C h a pter Four i n t r o d u c e s t h e Crow Rate as an i s s u e . 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 of t h e Crow Rate problem and i t o u t l i n e s t h e d i v e r s e c o n f l i c t s between t h e f e d e r a l government and t h e p r o v i n c e s , between and among t h e p r o v i n c e s and between t h e v a r i o u s s o c i o - e c o n o m i c s e c t o r s . The most i m p o r t a n t c h a p t e r i s C h a p t e r F i v e . I t a n a l y z e s t h e f e d e r a l government's approach t o overcome t h e - 15 -c o n s t r a i n t s o f t h e f e d e r a l s t a t e t o r e s o l v e t h e Crow Rate i s s u e . There i s an e x a m i n a t i o n of t h e c o n f l i c t s w i t h i n t h e f e d e r a l government t o e s t a b l i s h i t s s t r a t e g y . The f e d e r a l government had t o implement change i n a r e g i o n where i t had v i r t u a l l y no e l e c t o r a l s u p p o r t . Throughout t h i s c h a p t e r s p e c i a l emphasis i s p l a c e d on t h e r o l e of a f e d e r a l C a b i n e t M i n i s t e r ( T r a n s p o r t M i n i s t e r Jean-Luc P e p i n ) i n t h i s d e bate. The advocacy r o l e of a C a b i n e t M i n i s t e r t o b r i n g about a change i n a f e d e r a l a rea of j u r i s d i c t i o n , a f f e c t i n g p r i m a r i l y one r e g i o n , d e s e r v e s s p e c i a l a t t e n t i o n . The e v o l u t i o n o f C a b i n e t s o l i d a r i t y has tended t o de-emphasize th e concept of " r e g i o n a l m i n i s t e r s " . T h i s t r a d i t i o n a l advocacy r o l e has, i n r e c e n t t i m e s , been f i l l e d by p r o v i n c i a l P r e m i e r s . T h i s i m p o r t a n t s e c t i o n a n a l y z e s t h e i n c r e a s i n g r o l e of P r e m i e r s i n n a t i o n a l p o l i c y development. Chapter F i v e a l s o i n c l u d e s a s e c t i o n on n e g o t i a t i o n i n a f e d e r a l s t a t e showing t h e r o l e of P a r l i a m e n t and a n a l y z e s t h e a l t e r n a t i v e approaches u t i l i z e d i n t h e Crow Rate debate. The approach t o p o l i c y f o r m a t i o n w h i c h emerged, may s e r v e as a g u i d e t o r e s o l v i n g f u t u r e 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 . The documents t o be employed t o s u p p o r t t h e a n a l y s i s - 16 -i n C h a p t e r s Two t o F i v e w i l l i n c l u d e a t i m e - s e r i e s r e v i e w of t h e p e r s o n a l w o r k i n g papers of t h e former M i n i s t e r of T r a n s p o r t , Jean-Luc P e p i n . I n c l u d e d i n t h i s r e v i e w a re v a r i o u s Memoranda t o C a b i n e t w o r k i n g n o t e s and i n t e r -d e p a r t m e n t a l b r i e f i n g n o t e s . The c h a p t e r on " N e g o t i a t i o n i n a F e d e r a l S t a t e " i s s u p p o r t e d by a r e v i e w of t h e t e c h n i c a l p o s i t i o n papers of a l l t h e major p a r t i c i p a n t s i n v o l v e d i n t h e d i s c u s s i o n s , w i t h Dr. C l a y G i l s o n , t he f e d e r a l l y a p p o i n t e d n e g o t i a t o r . The c o m p l e x i t y and the 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 r e s e a r c h m a t e r i a l l e n d s i t s e l f t o a case s t u d y approach. P u b l i c o p i n i o n was a s s e s s e d t h r o u g h an a n a l y s i s of the v a r i o u s s u r v e y s u n d e r t a k e n by d i f f e r e n t g roups, i n c l u d i n g a s u r v e y u n d e r t a k e n by t h e a u t h o r . An impact m a t r i x i s c o m p i l e d t o show how d i f f e r e n t s e c t o r s and groups were a f f e c t e d by Crow Rate changes and how t h e s e d i f f e r e n c e s i n f l u e n c e d p u b l i c o p i n i o n . An Inside-Outside Access Model i s de v e l o p e d t o e x p l a i n a unique n e g o t i a t i o n approach t a k e n t o r e a c h a c o n c l u s i o n on the Crow Rate g i v e n t h e e x i s t i n g c o n s t r a i n t s . The Inside-Outside Access Model i s a h e l p f u l framework f o r t h e Crow Rate Case Study and might be used - 17 -t o examine o t h e r 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 i e s such as development of r a i l w a y s a f e t y l e g i s l a t i o n . - 18 -NOTES Page 1 of 1 JRoval 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. 5Ibid. p. 26. 6Larry Grossman, "Regionalism Run Amok", Canadian Business. September, 1980, p. 180. ^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 ROLE OF PUBLIC POLICY FORMULATION IN THE CANADIAN POLITICAL SYSTEM 2.0 Introduction T h i s c h a p t e r o u t l i n e s t h e s t r u c t u r e o f t h e Canadian p o l i t i c a l system and a n a l y z e s i t s i n f l u e n c e on p u b l i c p o l i c y f o r m u l a t i o n . The c h a p t e r shows how Canada's p o l i t i c a l i n s t i t u t i o n s , i n c o n j u n c t i o n w i t h e s t a b l i s h e d i n t e r e s t g roups, can s e v e r e l y 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. I n l a t e r c h a p t e r s , t h e t h e s i s 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 f e d e r a l i s m and i n t e r e s t groups' i n t e r - a c t i o n c o n s t r a i n change i n f e d e r a l p o l i c i e s . I t can be argued t h a t t h e i n t e n s i t y o f o p p o s i t i o n t o a p a r t i c u l a r p o l i c y , may w e l l be p r i m a r i l y r o o t e d i n t h e economic i n t e r e s t s and t h e t r a d i t i o n s of independent groups i n s o c i e t y . But t h i s t h e s i s w i l l show t h a t t h e e x i s t e n c e of Canada's f e d e r a l system p r o v i d e s t h o s e groups an a d d i t i o n a l l e v e l of government t h a t can be m o b i l i z e d t o def e n d t h e i r i n t e r e s t s . Moreover, p r o v i n c i a l governments o f t e n r e i n f o r c e t h e f e a r s o f t h e p o p u l a t i o n and i n t e r e s t g r o u p s , p r o v i d e s t r a t e g i c l e a d e r s h i p f o r t h e i r p r o t e s t , and bestow l e g i t i m a c y on t h e r e s i s t a n c e t o change. A c o a l i t i o n o f p o w e r f u l i n t e r e s t groups and t h e i r p r o v i n c i a l - 20 -governments i s a p o t e n t f o r c e i n n a t i o n a l p o l i c y - m a k i n g even, as w i l l be demonstrated i n t h i s t h e s i s , i n a r e a s of e x c l u s i v e f e d e r a l government j u r i s d i c t i o n such as t h e Crow Rate. I n s p e c i f i c terms t h i s c h a p t e r examines t h e main i n s t i t u t i o n s of Canadian P o l i t i c s and a s s e s s e s t h e i r r o l e i n p o l i c y development. The concept of f e d e r a l i s m i s e x p l o r e d w i t h a s t r o n g r e f e r e n c e t o t h e theme of " p r o v i n c e - b u i l d i n g " . The a p p l i c a b i l i t y of t h r e e w o r k i n g models are d i s c u s s e d , p a r t i c u l a r l y t h e model of e x e c u t i v e f e d e r a l i s m i n terms of t h e concept b e i n g an impediment towards t h e development of e f f i c i e n t and e f f e c t i v e 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 . The C a b i n e t system w i t h i t s b u r e a u c r a t i c arms, the c e n t r a l a g e n c i e s , i s examined t o d e t e r m i n e how t h e s e groups i n t e r p l a y w i t h each o t h e r , w i t h o t h e r s i m i l a r governmental groups and w i t h o t h e r groups such as s p e c i a l i n t e r e s t o r g a n i z a t i o n s and t h e media. The r o l e of s p e c i a l i n t e r e s t groups and t h e media are a l s o examined s i n c e b o t h t h e s e groups p l a y e d i m p o r t a n t r o l e s i n t h e Crow Rate debate. - 21 -2.1 The M a i n I n s t i t u t i o n s o f C a n a d i a n P o l i t i c s T h i s s e c t i o n d i s c u s s e s t h e main i n s t i t u t i o n s of C anadian p o l i t i c s . The f i r s t i n s t i t u t i o n d i s c u s s e d i s " f e d e r a l i s m " w i t h p r o v i n c e - b u i l d i n g a p p e a r i n g as an i m p o r t a n t theme. The h i s t o r i c a l e v o l u t i o n of f e d e r a l i s m i s r e v i e w e d w i t h r e f e r e n c e t o t h r e e a n a l y t i c a l models: c o o p e r a t i v e , e x e c u t i v e and t h e c u r r e n t c o l l a b o r a t i v e form of f e d e r a l i s m . 2.1.1. F e d e r a l i s m Canada i s a f e d e r a l s t a t e . F e d e r a l i s m i m p l i e s , i n t h e c l a s s i c a l d e f i n i t i o n , t h e t e r r i t o r i a l d i v i s i o n of powers t o g o v e r n . 1 T h i s s i m p l e d e f i n i t i o n does not r e f l e c t t h e complex and c o n f u s i n g form of f e d e r a l i s m i n Canada. Canada i s a C o n f e d e r a t i o n c o m p r i s e d of e l e v e n governments, one f e d e r a l and t e n p r o v i n c i a l . The power t o make laws i n Canada are g i v e n t o b o t h a n a t i o n a l government and t o t h e t e n p r o v i n c i a l governments. The i n i t i a l d i v i s i o n o f powers i s c o n t a i n e d i n t h e Constitution Act (1867). In t h a t A c t t h e f e d e r a l and p r o v i n c i a l powers a r e c o n t a i n e d i n S e c t i o n s 91 t o 93. I t i s c l e a r from a r e v i e w of t h e f e d e r a l powers t h a t i t was - 22 -i n t e n d e d t h a t t h e c e n t r a l government s h o u l d have t h e g r e a t e r power. 2 S e c t i o n 91 a l l o w s t h e f e d e r a l government t o "...make laws f o r t h e Peace, Order and good Government of Canada", and t h i s w o rding i s o f t e n c i t e d t o s u p p o r t t h e 1867 i n t e n t i o n t o e s t a b l i s h a s t r o n g c e n t r a l government. I n a d d i t i o n t h e c e n t r a l government a l s o was g i v e n t h e power t o d i s a l l o w o r o v e r t u r n any p r o v i n c i a l law t h a t i t d e c i d e d was not i n t h e i n t e r e s t of t h e c o u n t r y as a whole. T h i s power has not been used s i n c e 1943. Under S e c t i o n 92:10 t h e f e d e r a l government was g i v e n immense a u t h o r i t y i n t r a n s p o r t a t i o n i n c l u d i n g t h e t a k e o v e r o f p r o v i n c i a l r o a d s , c a n a l s and r a i l w a y s i f i t were i n t h e n a t i o n a l i n t e r e s t t o do so.3 i n 1867 Canada was a l a r g e l y r u r a l p r i m a r y - p r o d u c i n g economy. By t h e t u r n of t h e c e n t u r y i t was c h a n g i n g i n t o an urban i n d u s t r i a l s o c i e t y and demands f o r government s e r v i c e s i n c r e a s e d . The p a t t e r n of i n t e r -g o v e r n m e n t a l c o n f l i c t was e s t a b l i s h e d as e a r l y as 1905. C h r i s t o p h e r A rmstrong i n h i s book The Politics of Federalism o u t l i n e s i n d e t a i l t h e e a r l y c o n f l i c t s between "Empire O n t a r i o " and t h e f e d e r a l government, and he documents t h e " . . . r o l e o f p r i v a t e i n t e r e s t s i n p r o v o k i n g i n t e r -g o v e r n m e n t a l c o n f l i c t as r i v a l p a r t i e s sought s u p p o r t e i t h e r i n Ottawa o r Queen's P a r k " . 4 By t h e 1930s t h e p r o v i n c i a l governments were f a c e d - 23 -w i t h e n l a r g e d r e s p o n s i b i l i t i e s a r i s i n g out of the D e p r e s s i o n but l i m i t e d f i n a n c i a l c a p a c i t y t o d i s c h a r g e t h e s e r e s p o n s i b i l i t i e s . The f e d e r a l government responded by u s i n g i t s s p e n d i n g power t o h e l p out b u t , as Hugh Tho r b u r n s t a t e s , " . . . t h e ground was l a i d f o r t h e somewhat u n s a t i s f a c t o r y s i t u a t i o n of t o d a y : o v e r l a p p i n g j u r i s d i c t i o n s and competing p o l i c y i n i t i a t i v e s by t h e two l e v e l s of government." 5 A l t h o u g h d u r i n g t h e 1939-45 World War, and f o r a p e r i o d a f t e r t h e war, t h e c o u n t r y was governed almost as a u n i t a r y s t a t e , t h e move towards p r o v i n c e - b u i l d i n g was d e e p l y e n t r e n c h e d . P r o b a b l y t h e most quoted a r t i c l e on p r o v i n c e - b u i l d i n g has been w r i t t e n by A l a n C a i r n s . He d e t e r m i n e d t h a t t h e p r o v i n c e s had numerous f a c t o r s w o r k i n g i n t h e i r f a v o u r " . 6 These were: 1. I m p r e s s i v e c o n s t i t u t i o n a l r e s p o n s i b i l i t i e s i n areas of expanding government c o n c e r n , n o t a b l y , w e l f a r e , e d u c a t i o n , highway 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 improved i n t h e postwar y e a r s . 3. J u r i s d i c t i o n a l c o n t r o l of t h e growth a r e a s of government. I t was t h i s growth i n p r o v i n c i a l powers t h a t t r a n s f o r m e d f e d e r a l i s m i n Canada. G a r t h Stevenson b e l i e v e s t h i s - 24 -growth o f t h e s t a t e at t h e s u b - n a t i o n a l l e v e l i s unique i n th e modern w o r l d . As a r e s u l t : . . . p r o v i n c i a l governments th e m s e l v e s now po s s e s s i m p r e s s i v e means of c o m p l i c a t i n g , f r u s t r a t i n g and i n t e r f e r i n g w i t h p o l i c y making 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 a r e f a r l e s s h e s i t a n t t o use t h a n 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 abandoned power of d i s a l l o w a n c e . 7 The growth of p r o v i n c i a l i s m has had a major impact on th e c o n c e p t of p o l i t i c a l r e g i o n a l i s m i n w e s t e r n Canada, as documented by Roger G i b b i n s . 8 G i b b i n s b e l i e v e s t h a t i t i s no l o n g e r p o s s i b l e t o i m p e l t h e p o p u l a t i o n towards a r e g i o n a l l y d i s t i n c t s t y l e of p o l i t i c a l b e h a v i o r . He p a r a -p h r a s e s E m i l e Durkheim t h a t t e r r i t o r i a l d i v i s i o n s l o s e t h e i r s i g n i f i c a n c e as t h e y become " . . . l e s s grounded i n t h e n a t u r e o f t h i n g s " . 9 S i g n i f i c a n t d i f f e r e n c e s between t h e n a t u r e o f t h i n g s on t h e p r a i r i e s and t h e n a t u r e o f t h i n g s e l s e w h e r e i n E n g l i s h - s p e a k i n g Canada a r e becoming h a r d e r and h a r d e r t o d e t e c t , a c c o r d i n g t o G i b b i n s . 1 0 G i b b i n s a l s o a s s e r t s t h a t i t i s t h e p o l i t i c a l system t h a t molds t h e s u r r o u n d i n g s o c i a l and economic e n v i r o n m e n t s . He r e f e r s t o t h e 1966 "keynote a r t i c l e " on t h e e v o l u t i o n o f Ca n a d i a n f e d e r a l i s m by B l a c k and C a i r n s t o s u p p o r t h i s - 25 -argument t h a t " . . . p o l i t i c a l i n t e g r a t i o n i s not an i n e v i t a b l e consequence of u r b a n i z a t i o n , i n d u s t r i a l i z a t i o n and r i s i n g s t a n d a r d s o f l i v i n g " . 1 1 A c c o r d i n g t o G i b b i n s , B l a c k and C a i r n s argue " . . . p o l i t i c a l i n s t i t u t i o n s and l e a d e r s have p l a y e d a key r o l e i n s h a p i n g , g i v i n g e x p r e s s i o n s t o and p e r p e t u a t i n g t h e d i s t i n c t i v e r e g i o n a l o u t l o o k s " . 1 2 G i b b i n s makes the argument t h a t t h e near absence of r e g i o n a l p o l i t i c a l i n s t i t u t i o n s i n w e s t e r n Canada, c o u p l e d w i t h t h e growth of s t r o n g governments, has fragmented t h e p r a i r i e r e g i o n s a l o n g t h e l i n e s of p r o v i n c i a l b o u n d a r i e s and t h a t t h e e f f e c t of t h i s f r a g m e n t a t i o n has been t o reduce t h e r e g i o n a l i z a t i o n of p o l i t i c s i n t h e Canadian west. An i m p o r t a n t f i n d i n g of t h i s t h e s i s documents the manner i n w h i c h th e Crow Rate debate e v o l v e d and thus p r o v i d e s s u p p o r t t o t h e argument of G i b b i n s . A n o t h e r r e a s o n f o r t h e d e c l i n e i n r e g i o n a l i s m i n Canada a t t h e expense of p r o v i n c i a l i s m i s " . . . p r o v i n c i a l governments have been a l l o w e d t o get away w i t h a c t i o n s t h a t would have been c o n s i d e r e d o u t r a g e o u s i n o t h e r c o u n t r i e s " . 1 3 A former S e c r e t a r y t o t h e F e d e r a l C a b i n e t , Gordon R o b e r t s o n , n o t e s t h a t such a c t i o n t e n d s " . . . t o undermine Ottawa's l e g i t i m a c y and e f f e c t i v e n e s s i n d e f i n i n g and i m p l e m e n t i n g a n a t i o n a l i n t e r e s t " . 1 ^ R i c h a r d Simeon - 26 -s u p p o r t s t h i s p o s i t i o n because he s u g g e s t s : " . . . t h a t t h e r e i s a fundamental imbalance i n t h e p r o c e s s . P r o v i n c e s are f r e e t o 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 p r e v e n t e d from a s i m i l a r v o i c e i n p r o v i n c i a l e d u c a t i o n p o l i c i e s w h i c h , i t c o u l d be argued, are e q u a l l y r e l e v a n t t o n a t i o n a l economic and c u l t u r a l d e v e l o p m e n t " . 1 5 C a i r n s r a i s e s c o n c e r n over what can be done t o a r r e s t t h e i m b a l a n c e . He s t a t e s : " . . . t h e p r o v i n c e s i n Canadian f e d e r a l i s m , e s p e c i a l l y t h o s e w h i c h combine w e a l t h and r e s o u r c e s w i t h i m p r e s s i v e j u r i s d i c t i o n a l c a p a c i t y , are 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 of any e x i s t i n g f e d e r a l system. They are more p o w e r f u l t h a n most of t h e member s t a t e s of t h e U n i t e d N a t i o n s " . 1 6 The s i g n i f i c a n c e of t h e above s t a t e m e n t s i s t h a t n a t i o n a l p o l i c y development must t a k e i n t o c o n s i d e r a t i o n t h e v i e w s of e l e v e n governments. T h i s i s c o n t r a r y t o Canada's h i s t o r i c a l c o ncept of p o l i c y development w h i c h d e v o t e d t i m e and e f f o r t t o r e s o l v i n g i s s u e s between two l e v e l s : f e d e r a l and p r o v i n c i a l , assuming t h a t a l l p r o v i n c i a l programs and p o l i c i e s were c o n s i s t e n t w i t h each o t h e r and s u p p o r t i v e of n a t i o n a l o b j e c t i v e s . Indeed, as R i c h a r d Simeon p o i n t s o u t , t h e s t r a t e g y o f t h e p r o v i n c e s has always been t o a t t a c k "Ottawa" r a t h e r t h a n each o t h e r . 1 7 T h i s has tended t o f o c u s i n t e r g o v e r n m e n t a l d i s c u s s i o n s as a c o n t e s t between t h e p r o v i n c e s and t h e f e d e r a l government. I n t u r n t h e p r o v i n c i a l governments, or o t h e r spokesmen r e p r e s e n t i n g i n t e r e s t g r o u p s , t e n d t o i n v o k e t h e co n c e p t o f " r e g i o n a l i s m " when making r e p r e s e n t -a t i o n t o t h e f e d e r a l government on a s p e c i f i c o r a l l e g e d g r i e v a n c e . I n r e v i e w i n g a p p r o x i m a t e l y 1,000 B r i e f s s u b m i t t e d t o t h e Macdonald Commission on Economic U n i o n and Development P r o s p e c t s f o r Canada (1985), Hugh Thorburn o b s e r v e d t h a t i t was common f o r o r g a n i z a t i o n s , such as t h e H a l i f a x and Dartmouth Board of Trade and t h e Moncton Chamber o f Commerce, t o e x p r e s s a l i e n a t i o n of t h e " M a r i t i m e r e g i o n " i n s t e a d of t h e i r r e s p e c t i v e c i t y from t h e economic b e n e f i t s o f C o n f e d e r a t i o n . P r e s s u r e groups o r s p e c i a l i n t e r e s t groups adopt t h e same s t r a t e g y . I n 1969 t h e Saskatchewan Wheat P o o l approved a r e s o l u t i o n c a l l i n g f o r th e " c o n s i d e r a t i o n o f s e c e s s i o n i f t h e f e d e r a l government does not g i v e due c o n s i d e r a t i o n t o t h e problems o f Western C a n a d a " . 1 8 T h o r b u r n 1 9 c o n c l u d e d t h a t as a r e s u l t o f h i s e x a m i n a t i o n of t h e B r i e f s t o t h e Macdonald Commission no p a r t o f Canada p e r c e i v e s i t s e l f as a net w i n n e r . T h i s c o n c l u s i o n i s s u p p o r t e d by R i c h a r d Simeon who p o i n t e d out " . . . l i s t e n i n g t o a l l t h e g r i e v a n c e s , one sometimes g e t s - 28 -t h e i m p r e s s i o n t h a t a l l r e g i o n s a re ' l o s e r s ' i n t h e C o n f e d e r a t i o n b a l a n c e s h e e t " . 2 0 T h i s i s so because t h e b e n e f i t s of C o n f e d e r a t i o n a re measured on a p r o v i n c i a l b a s i s not on a r e g i o n a l o r n a t i o n a l s c a l e . J.E. Hodgetts a t t a c k s t h e concept of r e g i o n a l i s m . He has argued t h a t r e g i o n s i n Canada are e s s e n t i a l l y " b u r e a u c r a t i c c o n s t r u c t s " . 2 1 He s t a t e s t h a t : " . . . r e g i o n a l i s m , at any l e v e l one w i s h e s t o t a k e i t , does not g e n e r a t e spontaneous demands t h a t t h r u s t t hemselves on t h e p o l i t i c a l system and are i n s t r u m e n t a l i n i n f l u e n c i n g t h e p o l i c y o u t p u t s of t h e system. The r e g i o n i s not ' so much t h e c r e a t o r o f 1 p o l i c y as t h e c r e a t u r e of p o l i c y " . 2 2 T h i s r a i s e s t h e q u e s t i o n as t o whether t h e co n c e p t of r e g i o n a l i s m i s v a l i d t o d a y o r has t h e co n c e p t o f p r o v i n c i a l i s m o r p r o v i n c e - b u i l d i n g , d e f i n e d by B l a c k and C a i r n s 2 3 , as " . . . s t r e n g t h e n i n g t h e c a p a c i t y of p r o v i n c i a l p o l i t i c a l systems t o govern t h e i n t e r e s t s o f r e g i o n a l c o m m u n i t i e s . . . " , become t h e new f o c u s o f a more d e c e n t r a l i z e d f e d e r a t i o n ? Today n a t i o n a l p o l i c i e s l o o s e l y i n t e g r a t e d s e c t o r i a l t e n d i s t i n c t p r o v i n c e s , each must b i n d t o g e t h e r s e v e r a l economies o v e r a network of w i t h t h e i r own economic and 29 -s o c i a l development p l a n s . The t e m p t a t i o n e x i s t s t o use t h e term " r e g i o n a l " i n p l a c e of " s e c t o r i a l " but t h e term r e g i o n i s l i m i t e d i n t h e Canadian c o n t e x t . I f one r e f e r s t o t h e M a r i t i m e r e g i o n one must omit Newfoundland. I t p r e f e r s t o be known as one of t h e f o u r A t l a n t i c p r o v i n c e s . O ther r e g i o n s a r e Quebec, O n t a r i o , t h e P r a i r i e s and B r i t i s h C o l u m b i a . T h i s nomenclature as H o d g e t t s 2 4 p o i n t s out i s q u i t e t y p i c a l and r e v e a l s how q u i c k l y we exhaust t h e r e g i o n a l c oncept when a p p l i e d a c r o s s t h e n a t i o n . I n terms of n o r t h e r n Canada, a l l t h e p r o v i n c e s would p r e f e r t o e x t e n d t h e i r b o u n d a r i e s n o r t h t o i n c l u d e t h e Yukon and t h e N o r t h West T e r r i t o r i e s . The Macdonald Commission between f e d e r a l and p r o v i n c i a l S t e v e n s o n w r i t e s : " . . . t h i s has been an e n d u r i n g f e a t u r e of C a n a d i a n p o l i t i c a l l i f e f o r more t h a n a c e n t u r y . Indeed i t has been so u b i q u i t o u s t h a t i t tends t o be t a k e n f o r g r a n t e d or 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 C o n s e q u e n t l y , a c c o r d i n g t o Stevenson: " . . . t h e r e has been no s y s t e m a t i c s t u d y o f 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 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 system 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 r e s o l v e d " . 2 6 r e c o g n i z e d t h e c o n f l i c t governments and, as G a r t h - 30 -T h i s t h e s i s a ttempts t o address t h i s v o i d by-a n a l y z i n g t h e mechanism and p r o c e s s e s used t o r e s o l v e t h e Crow R a t e , w i t h emphasis on t h e i n t e r a c t i o n e f f e c t s between i n t e r e s t group a c t i o n and t h e c o n f l i c t between f e d e r a l and p r o v i n c i a l governments. The n e x t s e c t i o n d i s c u s s e s how t h e two l e v e l s of government i n Canada i n t e r a c t t o d e v e l o p and implement p o l i c i e s . 2.1.2 Models o f F e d e r a l i s m From t h e d i s c u s s i o n so f a r i t i s p o s s i b l e t o d e s c r i b e f e d e r a l i s m as a k i n d of t e r r i t o r i a l d i v i s i o n of power between t h e l e v e l s of government, each h a v i n g s e p a r a t e and o v e r - l a p p i n g j u r i s d i c t i o n . The e v o l u t i o n of the modern Canadian a d m i n i s t r a t i v e s t a t e has i n c r e a s e d t h e need f o r f e d e r a l - p r o v i n c i a l c o o p e r a t i o n i n t h e development of p u b l i c p o l i c y . The p e r i o d between 1920s t o t h e 1960s d i d r e s u l t i n c o n s i d e r a b l e f e d e r a l - p r o v i n c i a l c o o p e r a t i o n and t h e e s t a b l i s h m e n t o f many s h a r e d - c o s t programs ( a t g r e a t expense t o b o t h t h e f e d e r a l and p r o v i n c i a l p u b l i c p u r s e ) and, as a r e s u l t , t h e term cooperative federalism i s used - 31 -t o d e s c r i b e i n t e r g o v e r n m e n t a l r e l a t i o n s d u r i n g t h a t time p e r i o d . B a s i c a l l y i t r e f l e c t s t h e view, " . . . t h a t Ottawa can n ot d i c t a t e t o t h e p r o v i n c e s ; r a t h e r i t must r e l y on t e c h n i q u e s o f d i p l o m a c y , p e r s u a s i o n and c o n s u l t a t i o n . " 2 7 However, i t must be p o i n t e d out t h a t t h e i n i t i a t i v e s were u n d e r t a k e n w i t h f e d e r a l l e a d e r s h i p . The t e c h n i q u e s used were f e d e r a l use of t a x a t i o n , e x p e n d i t u r e , monetary p o l i c y and sp e n d i n g power. One o f t h e s t r o n g e s t p r a c t i t i o n e r s of c o o p e r a t i v e f e d e r a l i s m was Jean-Luc P e p i n . I n 1964 he w r o t e : " . . . t h e r e s h o u l d be no q u e s t i o n of o p p o s i n g c u l t u r e s , languages and ' n a t i o n s w i t h i n Canada. We s h o u l d r a t h e r seek t o l i n k them, a c h i e v i n g a s y n t h e s i s m i n d f u l of t h e r i g h t s and o b l i g a t i o n s of each of t h e m . " 2 8 Mr. P e p i n a l s o o u t l i n e d s u p p o r t f o r p r i o r i t y of p r o v i n c i a l a u t h o r i t y i n c e r t a i n f i e l d s . T h i s s t r o n g p r o v i n c i a l s t a n c e , r e f l e c t e d i n a subsequent Task F o r c e R e p o r t on U n i t y , brought Mr. P e p i n i n t o c o n f l i c t w i t h Mr. Trudeau. Mr. P e p i n agrees t h a t h i s , " . . . d i f f e r i n g p o i n t o f v i e w on t h e C o n s t i t u t i o n w i t h Mr. Trudeau" p r o b a b l y l e d (1980) t o h i s appointment as T r a n s p o r t M i n i s t e r . 2 9 Chapter Four w i l l p r o v i d e i n s i g h t i n t o t h e s i g n i f i c a n c e o f t h i s i n c i d e n t . - 32 -D u r i n g a p e r i o d o f growth and p r o s p e r i t y (and w i t h t h e p o s s i b l e e x c e p t i o n of Quebec) few p r o v i n c e s o b j e c t e d t o t h e mas s i v e f e d e r a l i n t e r v e n t i o n i n p r o v i n c i a l a r e a s . But by t h e l a t e 1 9 6 0 s . t h i s changed. F i r s t , i n f l a t i o n made a l l s h a r e d c o s t programs more e x p e n s i v e and a f f e c t e d t h e e s t a b l i s h m e n t o f new programs and second, p r o v i n c e s began t o compete more d i r e c t l y w i t h each o t h e r and w i t h the f e d e r a l government. I n c r e a s e d i n t e r - p r o v i n c i a l and f e d e r a l - p r o v i n c i a l c o n s u l t a t i o n l e d t o i n c r e a s e d meetings between and among o f f i c i a l s o f t h e e l e v e n governments. D u p r e 3 0 a p p l i e s t h e term executive federalism, "...as embodying t h e r e l a t i o n s between t h e e l e c t e d and a p p o i n t e d o f f i c i a l s o f t h e e n e r g i z i n g e x e c u t i v e s of our f e d e r a l and p r o v i n c i a l l e v e l s of government." The prime mode used t o p r a c t i c e e x e c u t i v e f e d e r a l i s m was t h e i n t e r g o v e r n m e n t a l forum o r f e d e r a l -p r o v i n c i a l c o n f e r e n c e . Between 1957 and 1977 i t i s e s t i m a t e d t h e r e were 158 m i n i s t e r i a l m eetings and an a d d i t i o n a l 335 meetings of f e d e r a l - p r o v i n c i a l o f f i c i a l s . 3 1 G i v e n t h i s s c a l e o f meetings i t i s not d i f f i c u l t t o agree w i t h F l e t c h e r and W a l l a c e t h a t t h e p r o c e s s e s of e x e c u t i v e f e d e r a l i s m can be i d e n t i f i e d as a major impediment t o e f f e c t i v e c o n f l i c t management i n t h e system - 33 -and as a g e n e r a t o r of c o n f l i c t s themselves. 3-^ E x e c u t i v e f e d e r a l i s m i n v o l v e s c e n t r a l agents and s e n i o r C a b i n e t M i n i s t e r s n e g o t i a t i n g more fundamental i s s u e s . The f o c u s has s w i t c h e d from f u n c t i o n t o power and p r e s t i g e and on p r o t e c t i n g j u r i s d i c t i o n a l t u r f . 3 3 A c c o r d i n g t o S m i l e y : " I n t h e C anadian system of government t h e e x e c u t i v e has a v e r y wide d i s c r e t i o n - freedom from e f f e c t i v e c o n t r o l of t h e e l e c t e d l e g i s l a t u r e , of p a r t y o r g a n i z a t i o n s and, i n most c i r c u m s t a n c e s , of p r i v a t e i n t e r e s t g r o u p s . " 3 4 T h i s i s compounded by a maze of d i v i d e d j u r i s d i c t i o n s between and among governments w h i c h adds c o m p l e x i t y , c o n f u s i o n and s e c r e c y t o n e g o t i a t i o n s . C a b i n e t Papers are k ept s e c r e t u n l e s s t h e r e are s t r a t e g i c reasons t o make them a v a i l a b l e t o t h e media o r i n t e r e s t groups as was t h e c a s e i n t h e Crow Rate d e b a t e . T h i s e s s e n t i a l l y p o l i t i c a l n a t u r e of e x e c u t i v e f e d e r a l i s m i s summarized by S m i l e y : " . . . 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 of e x e c u t i v e f e d e r a l i s m a r e d i s p o s e d 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 summitry a l o n g w i t h t h e r e l a t e d phenomenon of a d m i n i s t r a t i v e r a t i o n a l i z a t i o n has weakened the c a p a c i t y of t h e system t o make p i e c e - m e a l and i n c r e m e n t a l 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 p r o f e s s i o n a l g r o u p i n g s . Even more c r u c i a l l y , t h e p u r s u i t of j u r i s d i c t i o n a l autonomy i n c r e a s i n g l y t a k e s p l a c e o u t s i d e a s h a r e d a c c e p t a n c e of c o n s t i t u t i o n a l and l e g a l norms about t h e r e s p e c t i v e powers o f t h e two o r d e r s o f g o v e r n m e n t " . 3 5 The n a t u r a l e x t e n s i o n of e x e c u t i v e f e d e r a l i s m has been t h e development o f programs such as t h e r e v i s e d L i b e r a l Government's N a t i o n a l Energy Program of 1983 and t h e c u r r e n t PC Energy P o l i c y , b o t h of w h i c h are agreements reached on a collaborative b a s i s between o r among governments. There was l i t t l e o r no r o l e f o r p u b l i c i n t e r e s t groups o r even f o r P a r l i a m e n t t o d i s c u s s t h e s e p o l i c i e s . Audrey Doerr a s s e r t s t h a t : ...the r a t e and scope of change 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 by w h i c h government 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 has t h r e a t e n e d t o make t h e c o n s t i t u t i o n a l d i v i s i o n of powers o b s o l e t e . 3 6 A good example of c o l l a b o r a t i v e f e d e r a l i s m was t h e p o s i t i o n o f Prime M i n i s t e r Trudeau i n 1981 when he r e f u s e d t o a d d r e s s t h e Crow Rate 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. T h i s d e c i s i o n was t a k e n d e s p i t e t h e - 35 -c a l l f o r change by some w e s t e r n a g r i c u l t u r a l o r g a n i z a t i o n s r e p r e s e n t i n g t h e m a j o r i t y of p r o d u c e r s . The Prime M i n i s t e r ' s p o s i t i o n was made i n P a r l i a m e n t on F e b r u a r y 12, 1981. I n t e r e s t i n g l y t h i s p o s i t i o n came a f t e r almost one y e a r t o t h e day, t h e L i b e r a l s r e g a i n e d power. D e s p i t e s u p p o r t f o r change t o t h e Crow Rate from t h e major a g r i c u l t u r a l groups such as t h e Western A g r i c u l t u r e C o n f e r e n c e and t h e P r a i r i e Farm Commodity C o a l i t i o n , w h i c h r e p r e s e n t e d a l l p r a i r i e p r o d u c e r s , t h e Prime M i n i s t e r would not agree t o t a k e a c t i o n u n t i l a consensus e x i s t e d as t o how t h e r a t e s h o u l d be changed and t h a t t h e t h r e e p r a i r i e governments were p a r t of t h a t c onsensus. G i v e n t h e c o n t r a d i c t o r y government p r i o r i t i e s and t h e magnitude of i n t e r g o v e r n m e n t a l r e l a t i o n s , i t i s not s u r p r i s i n g t h a t t h e governments have e s t a b l i s h e d complex, c e n t r a l p o l i c y s t r u c t u r e s t o d e a l w i t h t h e s e m a t t e r s . The next s e c t i o n examines t h e r o l e and f u n c t i o n of t h e C a b i n e t system and i t s b u r e a u c r a t i c arms t h e " c e n t r a l a g e n c i e s " . 2.1.3 The Cabinet System T h i s s e c t i o n d i s c u s s e s t h e t r a d i t i o n a l r o l e of t h e Ca n a d i a n C a b i n e t system and shows by example how t h e r o l e of r e g i o n a l m i n i s t e r s has changed over t i m e . I n a d d i t i o n - 36 -t h e s e c t i o n a n a l y z e s t h e d e c l i n e of L i b e r a l P a r t y s u p p o r t i n w e s t e r n Canada as a p a r t of a l a r g e r phenomenon i . e . , t h e e r o s i o n of t h e n a t i o n a l p a r t y system. The b a s i c purpose of any C a b i n e t system i s t o r e a c h t i m e l y d e c i s i o n s i n a way t h a t w i l l s a t i s f y t h e government's p r i o r i t i e s and needs, w h i l e m a i n t a i n i n g t h e c o l l e c t i v e r e s p o n s i b i l i t y of t h e C a b i n e t M i n i s t e r s . 3 7 T h i s d e f i n i t i o n has s i g n i f i c a n t meaning as i t a p p l i e s t o th e Canadian C a b i n e t . Under t h e Canadian p a r l i a m e n t a r y system t h e C a b i n e t , c h a i r e d by t h e Prime M i n i s t e r , i s t h e supreme d e c i s i o n - m a k i n g i n s t i t u t i o n i n Canada. I t i s t h e Prime M i n i s t e r who chooses w h i c h member from t h e g o v e r n i n g p a r t y w i l l be a p p o i n t e d t o t h e C a b i n e t . I t has become a Canad i a n p o l i t i c a l t r a d i t i o n t o a p p o i n t a t l e a s t one member not n e c e s s a r i l y j u s t from e v e r y r e g i o n but from e v e r y p r o v i n c e . I n a d d i t i o n any Prime M i n i s t e r must t a k e account o f s p e c i f i c p a r l i a m e n t a r y , economic and p e r s o n a l f a c t o r s i n d e s i g n i n g a C a b i n e t system i n w h i c h m i n i s t e r s can make p o l i c y and e x p e n d i t u r e d e c i s i o n s . The s i z e of t h e C a b i n e t has i n c r e a s e d from t h e 16-19 members o f t h e 1935 Mackenzie K i n g C a b i n e t t o t h e p r e s e n t 40-member Mu l r o n e y C a b i n e t . 3 8 The d e c i s i o n - m a k i n g p r o c e s s has changed as w e l l and t h i s w i l l be d i s c u s s e d i n - 37 -t h e f o l l o w i n g s e c t i o n on - C e n t r a l A g e n c i e s . A unique and somewhat u n d e r - a p p r e c i a t e d c h a r a c t e r i s t i c of t h e Canadian C a b i n e t system i s t h a t , as t h e supreme d e c i s i o n - m a k i n g i n s t i t u t i o n i n Canada, t h e r e a r e v i r t u a l l y no checks and b a l a n c e s on t h i s power. U n l i k e t h e U n i t e d S t a t e s where power i s s h a r e d among the S e n a t e , House of R e p r e s e n t a t i v e s and t h e C a b i n e t and, u n l i k e many European c o u n t r i e s w h i c h have e l e c t e d Upper Houses w i t h v a r i o u s forms of v e t o power, t h e Canadian C a b i n e t has no such c h e c k s . However, t h e r u l i n g p a r t i e s ' caucus can a f f e c t government p o l i c y . T h i s was d r a m a t i c a l l y d e m o n s t r a t e d i n t h e Crow Rate debate when s t r o n g o p p o s i t i o n from Quebec L i b e r a l s had a s i g n i f i c a n t a f f e c t on t h e f i n a l a pproach t a k e n by t h e government. As a l r e a d y d i s c u s s e d t h e n o n - e l e c t e d Senate has seldom used i t s power and t h e Prime M i n i s t e r , t h r o u g h t h e concept of P a r t y d i s c i p l i n e , does not have t o w o r r y about h i s own members v o t i n g a g a i n s t h i s w i s h e s i n t h e House of Commons. I n a d d i t i o n , C a b i n e t s o l i d a r i t y ( B r i t i s h t r a d i t i o n s ) e n s u r e s t h a t any m i n i s t e r who d i s a g r e e s w i t h t h e Prime M i n i s t e r cannot v o i c e h i s d i s s e n s i o n p u b l i c l y w i t h o u t r e s i g n i n g . R e s i g n a t i o n s o f m i n i s t e r s from t h e f e d e r a l C a b i n e t over p o l i c y d i f f e r e n c e s a r e r a r e and, up t o 1984, o n l y a h a n d f u l have done s o . 3 9 - 38 -The demands p l a c e d on i n d i v i d u a l C a b i n e t members are onerous. They have t o manage l a r g e l i n e departments e.g. t h e t r a n s p o r t m i n i s t e r must manage a department w i t h a p p r o x i m a t e l y 20,000 employees. I n a d d i t i o n such l a r g e and d i v e r s e o r g a n i z a t i o n s as A i r Canada, CN R a i l , t h e S t . Lawrence Seaway A u t h o r i t y , t h e Canada P o r t s C o r p o r a t i o n and t h e C a n a d i a n T r a n s p o r t Commission a l l r e p o r t t o P a r l i a m e n t t h r o u g h t h e M i n i s t e r of T r a n s p o r t . As such, t h e t r a n s p o r t m i n i s t e r i s a f a v o u r i t e t a r g e t o f s p e c i a l i n t e r e s t groups and f e l l o w Members of P a r l i a m e n t who want t o d i s c u s s problems and p o l i c i e s a f f e c t i n g t h e i r s e c t o r or c o n s t i t u e n c y . G i v e n t h i s heavy w o r k l o a d , one can a p p r e c i a t e how much time such a m i n i s t e r , has t o r e v i e w documents p r e p a r e d by o t h e r f e d e r a l departments b e f o r e a t t e n d i n g a C a b i n e t m e e t i n g . I n t u r n , one wonders how many C a b i n e t M i n i s t e r s f u l l y u n d e r s t o o d or even had t h e t i m e t o read t h e 110 page Memorandum t o C a b i n e t s u b m i t t e d by Mr. P e p i n on J u l y 9, 1982 w h i c h c o n t a i n e d a p r o p o s a l t o r e s o l v e t h e Crow Rate i s s u e . Mr. P e p i n ' s p r o p o s a l would commit t h e p u b l i c p u r s e t o an e x p e n d i t u r e o f $3.7 b i l l i o n i n t h e f i r s t f o u r y e a r s f o l l o w i n g i t s i m p l e m e n t a t i o n . To a d d r e s s onerous demands on m i n i s t e r s ' t i m e , t h e P e a r s o n C a b i n e t i n t r o d u c e d a number of ad hoc committees, - 39 -i n c l u d i n g t h e p o w e r f u l P r i o r i t i e s and P l a n n i n g Committee, to d e v e l o p government p r i o r i t i e s i n t h e o v e r a l l f i s c a l s i t u a t i o n . 4 0 Under t h e Trudeau C a b i n e t , t h e P l a n n i n g and P r i o r i t i e s Committee e v o l v e d i n t o an I n n e r C a b i n e t and, s i n c e many of t h e key m i n i s t e r s were r e p r e s e n t e d on t h i s committee and because th e Prime M i n i s t e r c h a i r e d t h i s committee, i t s d e c i s i o n s were a c c e p t e d by t h e f u l l C a b i n e t . He a l s o i n t r o d u c e d a f u l l range o f o t h e r C a b i n e t Committees. The C l a r k C a b i n e t , i n 1979, o f f i c i a l l y r e c o g n i z e d an I n n e r C a b i n e t and a p p o i n t e d 12 members t o t h i s key d e c i s i o n - m a k i n g body. The Trudeau C a b i n e t of 1980 a b o l i s h e d t h e I n n e r C a b i n e t and i n i t s p l a c e b o t h t h e f u l l C a b i n e t o f 37 members and t h e P r i o r i t i e s and P l a n n i n g Committee had a u t h o r i t y t o t a k e f i n a l d e c i s i o n s . 4 1 As w i l l be d i s c u s s e d i n t h e n e x t s e c t i o n , Mr. Trudeau a l s o r e t a i n e d t h e Program and E x p e n d i t u r e Management System (PEMS) and e s t a b l i s h e d a t t h e p u b l i c s e r v i c e l e v e l a M i n i s t r y o f S t a t e f o r Economic and R e g i o n a l Development (MSERD) and w i t h i n t h a t m i n i s t r y e s t a b l i s h e d F e d e r a l Economic Development C o o r d i n a t o r s (FEDC) i n each p r o v i n c e . I t i s i n t e r e s t i n g t o note t h a t FEDC's were e s t a b l i s h e d on a p r o v i n c i a l , not on a r e g i o n a l b a s i s . B o t h MSERD and FEDC would p l a y s i g n i f i c a n t r o l e s i n t h e Crow Rate d e b a t e . - 40 -B r o k e r a g e t h e o r y , w h i c h has dominated th e C anadian p o l i t i c a l s c i e n c e f i e l d argues t h a t n a t i o n a l p o l i t i c a l p a r t i e s must encompass a l l t h e e s s e n t i a l i n t e r e s t s i n t h e c o u n t r y i f b o t h a m a j o r i t y i s t o be s e c u r e d and m i n o r i t y r i g h t s g u a r a n t e e d . 4 2 I t i s beyond the scope of t h i s t h e s i s t o a n a l y z e how C a b i n e t s have p l a y e d out t h i s r o l e o v e r t h e y e a r s but t o t h e degree t h a t v a r i o u s r e g i o n a l , s e c t o r i a l and p r o v i n c i a l c o n c e r n s are r a i s e d a t t h e C a b i n e t l e v e l does suggest t h a t i n absence of an e l e c t e d Senate t h e " . . . C a b i n e t has become the t r u l y f e d e r a l body i n Canada p e r f o r m i n g th e same f u n c t i o n as t h e Senate i n t h e U n i t e d S t a t e s " . 4 3 R o l e of t h e R e g i o n a l M i n i s t e r The main problem f a c i n g any C a b i n e t i s t h e r e g i o n a l d i m e n s i o n of n a t i o n a l p o l i c y i n Canada, w h i c h has always been b o t h a c o n t r o v e r s i a l and a complex s u b j e c t . The p r i n c i p l e s o f e q u a l i t y and e q u i t y have meant t h a t n a t i o n a l p o l i c y has had t o accommodate on t h e one hand demands t h a t C anadians be t r e a t e d e q u a l l y wherever t h e y r e s i d e and, on t h e o t h e r hand, demands t h a t n a t i o n a l p o l i c y r e c o g n i z e t h e need t o t r e a t " r e g i o n s d i f f e r e n t l y " . 4 4 However t h e l o g i c of C a b i n e t government and t h e - 41 -c o n c o m i t a n t s t r i c t p a r t y d i s c i p l i n e s h a r p l y reduce t h e a b i l i t y of t h e f e d e r a l government t o r e f l e c t w i t h i n i t s e l f Canada's r e g i o n a l d i v e r s i t y . 4 5 The concept o f m i n i s t e r s as r e g i o n a l power b r o k e r s has changed over t h e l a s t t h i r t y y e a r s . A l a n C a i r n s has d e s c r i b e d t h i s t r a n s f o r m a t i o n : . . . 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 o f 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 p o l i t i c a l l e v e l i n t h e l a n d . The d e v e l o p i n g ascendancy at t h e Prime 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 p r e s i d e n t i a l -i z a t i o n under Trudeau, was made l e s s v i s i b l e t o 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 of Jimmy G a r d i n e r . . . c o n t i n u e d i n t o t h e m i d d l e decades of t h e 2 0 t h c e n t u r y . Now however r e g i o n a l spokesmen of such power and a u t h e n t i c i t y a r e o n l y memories. A l t h o u g h t h e r e g i o n a l b a s i s o f C a b i n e t appointment c o n t i n u e s , t h e r e g i o n a l power b r o k e r s are g o n e . 4 6 S i n c e t h i s t h e s i s f o c u s e s on t h e r o l e o f a C a b i n e t M i n i s t e r i n p o l i c y development i t i s n e c e s s a r y t o compare t h e r o l e of Jimmy G a r d i n e r t o t h a t of h i s l a t t e r d a y c o u n t e r p a r t s O t t o Lang and Jean-Luc P e p i n . James G. G a r d i n e r was t h e f e d e r a l M i n i s t e r of A g r i c u l t u r e from 1935 t o 1957 (a r e c o r d ) and was a former P r e m i e r o f Saskatchewan. O t t o Lang was M i n i s t e r of T r a n s p o r t between 1974 and 1979. Jean-Luc P e p i n was - 42 -M i n i s t e r o f T r a n s p o r t between 1980 and 1983.* I t i s i n t e r e s t i n g t o compare f e a t u r e s of each of t h e s e t h r e e m i n i s t e r s as t h e y r e l a t e t o t h e p r a i r i e s . Each m i n i s t e r was a t one ti m e c o n s i d e r e d t o be t h e " R e g i o n a l M i n i s t e r of t h e P r a i r i e s " . D a v i d E. Smith and Norman W a r d 4 7 a r e j o i n t l y w r i t i n g a b i o g r a p h y on James G. G a r d i n e r . Through a c c e s s t o t h e G a r d i n e r Papers t h e y have d e s c r i b e d t h e 22 y e a r c a r e e r o f G a r d i n e r as a p e r i o d when, " . . . r e g i o n a l l y p o w e r f u l f e d e r a l m i n i s t e r s i n j e c t e d p r o v i n c i a l i n t e r e s t s i n t o c e n t r a l government i n s t i t u t i o n s " . Today t h e concept o f r e g i o n a l m i n i s t e r s does not e x i s t . They have been r e p l a c e d as Smit h and Ward suggest by: . . . s t r o n g p r o v i n c i a l p o l i t i c i a n s c h a l l e n g i n g governments i n Ottawa and f i r s t m i n i s t e r s ' c o n f e r e n c e s competing w i t h C a b i n e t as t h e forum i n whi c h 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 T h i s assessment i s s u p p o r t e d by Matheson who s t a t e s t h e f e d e r a l - p r o v i n c i a l c o n f e r e n c e has l e d t o C a b i n e t ' s d e c l i n e as an i n s t r u m e n t o f r e g i o n a l a c c o m m o d a t i o n 4 9 and by Simeon who b e l i e v e s t h e f a i l u r e of t h e N a t i o n a l P a r t y *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 l e d t o t h e f o r m a t i o n of t h e F i r s t M i n i s t e r s ' C o n f e r e n c e . 5 0 Smith and W a r d 5 1 d e t e r m i n e d t h a t t h e r e were t h r e e u n i q u e f e a t u r e s t o G a r d i n e r ' s s t y l e of r e g i o n a l m i n i s t e r . 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 the p e o p l e have v o t e d a m a j o r i t y government, m i n o r i t y i n t e r e s t s s h o u l d not be a l l o w e d t o i n t e r f e r e . 2. I n C a b i n e t , t h e 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. H i s f e r v e n t d e s i r e t o make r e g i o n a l i s s u e s i m p o r t a n t on a n a t i o n a l b a s i s . C e r t a i n l y t h e r e i s n o t h i n g u n i q u e t o G a r d i n e r ' s model s i n c e b o t h Lang and P e p i n f u n c t i o n e d i n C a b i n e t s c o m p r i s e d of members who would agree w i t h t h e G a r d i n e r approach. Where G a r d i n e r d e p a r t s from Lang and P e p i n i s i n t h e manner i n w h i c h he a p p l i e d t h e above c h a r a c t e r i s t i c s . G a r d i n e r had l i t t l e f a i t h i n s e n i o r b u r e a u c r a c y and an o b s e s s i o n t h a t among h i s c o l l e a g u e s t h e r e was a p r e - d i s p o s i t i o n t o see t h e c o u n t r y from a c e n t r a l C anadian p e r s p e c t i v e . 5 2 No i s s u e p r o b a b l y d e m o n s t r a t e s t h i s p o s i t i o n b e t t e r t h a n th e i s s u e of t h e s o u t h Saskatchewan R i v e r Dam. No i s s u e on t h e p r a i r i e s , s i n c e t h e d r o u g h t of t h e 1930s, c o u l d compare t o Saskatchewan's b e l i e f t h a t a dam was u r g e n t l y needed. G a r d i n e r s u p p o r t e d t h i s b e l i e f - 44 -and spent most of h i s c a r e e r i n Ottawa a t t e m p t i n g t o c o n v i n c e th e f e d e r a l government t o c o n s t r u c t a p r o j e c t w h i c h he b e l i e v e d would be "the g r e a t e s t achievement i n Saskatchewan toward t h e development i n C a n a d a " . 5 3 I t i s i n t e r e s t i n g t o n o te t h a t t h e dam l e n t i t s e l f t o be an i s s u e t h a t s h o u l d have been s u p p o r t e d as a r e g i o n a l i s s u e w i t h b a c k i n g by a l l f e d e r a l members and a l l t h r e e p r a i r i e P r e m i e r s . T h i s was not t h e c a s e as t h e M a n i t o b a f e d e r a l L i b e r a l s were opposed as were t h e P r e m i e r s of Saskatchewan and M a n i t o b a . 5 4 The main problem w i t h t h e dam was t h a t i t was debated on a p o l i t i c a l b a s i s . There appears t o be no b e n e f i t - c o s t s t u d i e s u n d e r t a k e n w h i c h would show t h a t t h e r e was a r e a l need f o r a dam but G a r d i n e r b e l i e v e d t h a t i n Saskatchewan t h e r e was a p e r c e i v e d need f o r such an u n d e r t a k i n g . As former Saskatchewan P r e m i e r A l a n B l a k e n e y has s t a t e d " w e s t e r n e r s b e l i e v e t h a t f e d e r a l p o l i c y c o n s t r a i n s t h e i r r e g i o n and i n p o l i t i c s , b e l i e f s and p e r c e p t i o n s m a t t e r " . 5 5 The f a i l u r e o f t h e L i b e r a l s t o b u i l d t h e dam s i g n a l l e d t h e end t o t h e c a r e e r o f Jimmy G a r d i n e r and p r o b a b l y t o t h e end of t h e p o w e r f u l r e g i o n a l m i n i s t e r phenomenon. I t a l s o c o i n c i d e d w i t h t h e d e c l i n e o f t h e L i b e r a l P a r t y i n w e s t e r n Canada. - 45 -D e c l i n e of t h e L i b e r a l P a r t y i n Western Canada An e x a m i n a t i o n of f e d e r a l e l e c t i o n r e s u l t s between 1953 and 1980 show a s t e a d y d e c l i n e i n s u p p o r t f o r t h e f e d e r a l L i b e r a l s i n w e s t e r n Canada. The 1968 e l e c t i o n i s the e x c e p t i o n and t h i s can be a t t r i b u t e d t o t h e phenomenon of "Trudeaumania". The d e c l i n e i n e l e c t o r a l s u p p o r t f o r the L i b e r a l s began i n 1957 f o l l o w i n g t h e e l e c t i o n of t h e " P r o g r e s s i v e C o n s e r v a t i v e " m i n o r i t y government l e d by Saskatchewan's John D i e f e n b a k e r . Mr. D i e f e n b a k e r i m m e d i a t e l y announced h i s i n t e n t i o n t o b u i l d t h e South Saskatchewan Dam. I n a d d i t i o n he e s t a b l i s h e d t h e Prairie Grain Advance Payment Act. T h i s A c t encouraged t h e Canadian Wheat Board t o s e t p r i c e s f o r wheat and make payments t o p r a i r i e g r a i n p r o d u c e r s b e f o r e t h e Board a c t u a l l y knew what p r i c e i t would e v e n t u a l l y r e c e i v e f o r t h e g r a i n . The f e d e r a l government i s committed t o pay f o r any s h o r t f a l l i n f u n d s . Mr. D i e f e n b a k e r a l s o a p p o i n t e d former M a n i t o b a P r e m i e r John B r a c k e n t o head a R o y a l Commission on t h e a l l o c a t i o n of b o x c a r s f o r g r a i n . I n t h e f o l l o w i n g e l e c t i o n of 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 23 per c e n t of t h e v o t e i n Saskatchewan t o 16 out of 17 s e a t s and 51 per c e n t of t h e v o t e . I n t h e n i n e subsequent e l e c t i o n s , t h e PC P a r t y r e c e i v e d more v o t e s i n Saskatchewan t h a n any o t h e r P a r t y . The dam, completed i n t h e l a t e 1960s at a c o s t of $200 m i l l i o n hence has never come c l o s e t o p l a y i n g t h e r o l e e n v i s a g e d over t h e y e a r s by i t s s u p p o r t e r s . P r i m a r y g r a i n p r o d u c e r s have p r e f e r r e d t o grow c r o p s w h i c h r e q u i r e m i n i m a l e f f o r t such as wheat and b a r l e y i n p l a c e of c r o p s l i k e sugar b e e t s w h i c h r e q u i r e e x p e n s i v e i r r i g a t i o n from t h e dam and c o n s t a n t e f f o r t t o grow and h a r v e s t . Both D a v i d S m i t h 5 6 and B a r r y W i l s o n 5 7 have c o n c l u d e d -that t h e L i b e r a l s f a i l u r e t o b u i l d t h e dam, whether a c t u a l l y needed o r n o t , was a major f a c t o r i n t h e sub-sequent d e c l i n e o f t h e L i b e r a l P a r t y ( f e d e r a l l y and p r o v i n c i a l l y ) i n Saskatchewan. The q u e s t i o n of " p e r c e i v e d need" r e q u i r e s f u r t h e r a n a l y s i s s i n c e t h i s was a q u e s t i o n w h i c h p l a y e d a c e n t r a l r o l e i n t h e Crow de b a t e . I t was T r a n s p o r t M i n i s t e r O t t o Lang who was t o l e a r n t h e r e a l l e s s o n of p u b l i c p o l i c y development i n t h e p r a i r i e s i n t h e 1970s. U n l i k e Jimmy G a r d i n e r , O t t o Lang was a h i g h l y e d u c a t e d t e c h n o c r a t who b e l i e v e d t h a t b a s i c and s t r u c t u r a l changes were r e q u i r e d t o modernize t h e g r a i n h a n d l i n g and t r a n s p o r t system on t h e p r a i r i e s . - 47 -Table 1: The Liberals in Saskatchewan 1968-1980 l i s t s t h e reasons ( l e f t - h a n d e d column) p r o v i d e d by Smith and W i l s o n w h i c h t h e y a l l e g e l e d t o t h e d e c l i n e of t h e L i b e r a l P a r t y . Table 1: The Li b e r a l s 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 L i b e r a l Record & Ev e n t s t o S m i t h / W i l s o n ' - P a r t y o r g a n i z a t i o n and p o l i c y f a v o u r e d C e n t r a l Canada - M i n i s t e r i a l i s t s - Resource p o l i c y -e n f o r c e d dependence - South Saskatchewan 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 t h a n P e a r s o n A g r i c u l t u r a l P o l i c y - R e s i s t a n c e t o advance g r a i n payments - O p e r a t i o n L I F T - B r a n c h l i n e abandonment - Change i n Crow Rate P o p u l a r i t y o f D i e f e n b a k e r P a r t i c i p a t o r y democracy Western Economic Opport-u n i t i e s C o n f e r e n c e (WEOC) Report on B i l i n g u a l i s m / B i c u l t u r a l i s m O f f i c i a l Languages A c t M e t r i c Commission A g r i c u l t u r a l P o l i c y G r a i n s t a b i l i z a t i o n p l a n R e t e n t i o n o f most b r a n c h l i n e s M o d e r n i z a t i o n of g r a i n system ($1.7 b i l l i o n ) Change i n Crow Rate The i t e m s on t h e r i g h t - h a n d column a r e c o m p i l e d by t h e a u t h o r t o show t h e L i b e r a l achievements and t h e p o l i c i e s w h i c h p r o b a b l y a f f e c t e d t h e i r s t a n d i n g on t h e p r a i r i e s . - 48 -The two g e n e r a l reasons f o r t h e d o w n f a l l of t h e L i b e r a l s , s u g g e sted by Smith and W i l s o n , were th e s t r u c t u r e of t h e L i b e r a l P a r t y w h i c h was c e n t r e d i n O n t a r i o and Quebec and t h e concept of " m i n i s t e r i a l i s m " w h i c h t h e y a l l e g e r e s u l t e d i n C a b i n e t M i n i s t e r s t a k i n g a p a t e r n a l a t t i t u d e towards t h e west by i g n o r i n g i t s c o n c e r n s . However t h e L i b e r a l s i n t h e west e n c o u n t e r e d s u s t a i n i n g p o p u l a r i t y f o r D i e f e n b a k e r w h i c h t h e y t r i e d t o c o u n t e r w i t h t h e mention of a " p a r t i c i p a t o r y democracy" p o l i c y i n e s t a b l i s h i n g P a r t y p r i o r i t i e s . I n a d d i t i o n t h e L i b e r a l s h e l d t h e Western Economic O p p o r t u n i t i e s C o n f e r e n c e i n 1973 t o address a l l e g e d w e s t e r n g r i e v a n c e s . I n terms of a g r i c u l t u r a l p o l i c i e s t h e L i b e r a l s were blamed f o r e s t a b l i s h i n g O p e r a t i o n LIFT (Lower I n v e n t o r y For Tomorrow) wh i c h encouraged g r a i n p r o d u c e r s t o t a k e l a n d out o f p r o d u c t i o n i n 1972. I n 1973, g r a i n p r i c e s s o a r e d and many p r a i r i e p r o d u c e r s c o u l d not t a k e f u l l advantage of t h e h i g h e r p r i c e s and t h e r e f o r e t h e L i b e r a l s were blamed. S m i t h a l s o argues t h a t t h e F e d e r a l C a b i n e t e i t h e r e s t a b l i s h e d programs such as i t s r e s o u r c e p o l i c y , w h i c h he b e l i e v e s f a v o u r e d t h e consumer p r o v i n c e s o f O n t a r i o and Quebec o v e r t h e r e s o u r c e p r o v i n c e s of A l b e r t a and - 49 -Saskatchewan, o r f a i l e d t o respond i n t h e case of a g r i c u l t u r e t o t h e needs of t h e p r a i r i e s . Mr. Lang f a c e d an environment t o e s t a b l i s h p o l i c y on t h e p r a i r i e s much more h o s t i l e t h a n t h a t w h i c h f a c e d G a r d i n e r . Mr. Lang was opposed by t h e f e d e r a l P r o g r e s s i v e C o n s e r v a t i v e s who were t h e predominant p a r t y on t h e p r a i r i e s d u r i n g t h e 1970s and th e t h r e e p r a i r i e P r e m i e r s . Moreover, Mr. Lang was f a c e d w i t h a s i t u a t i o n of h a v i n g t o modernize a g r a i n h a n d l i n g and t r a n s p o r t system w h i c h had become a r c h a i c * The r e s u l t was t h a t e v e r y e f f o r t by Mr. Lang t o implement s t r u c t u r a l changes t o t h e system was met by s t i f f r e s i s t a n c e . R h e t o r i c and a d v e r s a r i a l p o l i t i c s r u l e d t h e day as e v e r y b r a n c h l i n e abandoned was c o n s i d e r e d a d e a t h k n e l l on t h e p r a i r i e s . A p p r o x i m a t e l y 85 per ce n t of th e r a i l l i n e network, w h i c h was e s t a b l i s h e d i n t h e l a t e 1930s when h o r s e haulage was a f a c t o r , i s s t i l l i n p l a c e t o d a y . The f a c t t h a t n e a r l y o n e - h a l f o f a l l b r a n c h l i n e m i l e a g e abandoned t o d a t e (1984) had a l r e a d y been abandoned by g r a i n p r o d u c e r s has never r e c e i v e d p u b l i c r e c o g n i t i o n . P e r c e p t i o n and mythology were t h e f a c t o r s w h i c h g r e a t l y i n f l u e n c e d g r a i n h a n d l i n g and t r a n s p o r t p o l i c y i n t h e 1970s. *The problems associated with the grain handling and transport system are discussed in detail in Chapter Four. - 50 -To what degree th e c o n s t r u c t i o n of a $200 m i l l i o n dam, t h a t was never r e a l l y r e q u i r e d f o r i r r i g a t i o n p u r p o s e s , has e n a b l e d th e PC's t o dominate t e n e l e c t i o n s i n Saskatchewan cannot be f u l l y answered. I n t u r n , O t t o Lang was f a r more s u c c e s s f u l i n w i n n i n g th e s u p p o r t of h i s C a b i n e t c o l l e a g u e s t h a n was Jimmy G a r d i n e r . I n t h e 1970s Mr. Lang was r e s p o n s i b l e f o r o v er $1.7 b i l l i o n of t r a n s p o r t r e l a t e d p r o j e c t s on t h e p r a i r i e s y e t h i s p a r t y ended up i n 1980 w i t h o n l y two s e a t s i n a l l of w e s t e r n Canada. Mr. Lang l o s t h i s Saskatchewan s e a t i n t h e 1979 e l e c t i o n . . The two L i b e r a l s e a t s i n 1980 were b o t h l o c a t e d i n W i n n i p e g . S m i t h argues t h a t t h e d e c l i n e of t h e L i b e r a l p a r t y was caused by i t s i n s e n s i t i v i t y towards t h e west p a r t i c u l a r l y t h e L i b e r a l s ' f a i l u r e t o r e c o g n i z e t h a t t h e p r a i r i e s , under L a u r i e r , had become f o r t h e w o r l d "synonomous w i t h Canada". An o p p o s i t e argument i s t h a t as t h e n a t i o n a l p a r t y i n power, between 1963 and 1984, t h e L i b e r a l s had become synonomous w i t h u n r e a l i z e d e x p e c t a t i o n s . I n terms of p o l i c y , t h e O f f i c i a l Languages A c t and t h e M e t r i c Commission p r o b a b l y had a g r e a t e r e f f e c t t h a n d i d O t t o Lang's p e r c e i v e d t r a n s p o r t and a g r i c u l t u r a l p o l i c i e s , on t h e d e c l i n e o f t h e L i b e r a l p a r t y . - 51 -I t i s a p p r o p r i a t e t o p o i n t out t h a t t h i s was the c o n t e x t of t h e c i r c u m s t a n c e s t h a t f a c e d Jean-Luc P e p i n on March 3, 1980 when he was a p p o i n t e d T r a n s p o r t M i n i s t e r . He f a c e d a s i t u a t i o n where t h e s t r u c t u r a l changes r e q u i r e d t o modernize t h e t r a n s p o r t system were s t i l l n ot i n p l a c e and many a g r i c u l t u r a l groups l o b b i e d f o r such changes. However P e p i n , e l e c t e d i n an Ottawa r i d i n g , knew t h a t he would be c o n f r o n t e d w i t h t h e same " m i s c o n c e p t i o n t h e o r y " t h a t l e d t o t h e demise of O t t o Lang. C h a p t e r F i v e 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 conundrum. Summary T h i s s e c t i o n d i s c u s s e s t h e t r a d i t i o n a l r o l e of t h e Cana d i a n C a b i n e t system. I t shows how t h e r e g i o n a l d i m e n s i o n i n C a b i n e t has d i m i n i s h e d i n r e c e n t t i m e s . P r o v i n c i a l P r e m i e r s p r o v i d e t h e b a s i c " p r o v i n c i a l " v i e w p o i n t as opposed t o f e d e r a l C a b i n e t M i n i s t e r s w h i c h r e p r e s e n t a " r e g i o n " i n C a b i n e t " S p e c i a l emphasis i s g i v e n t o James G a r d i n e r t o i l l u s t r a t e t h e t r a d i t i o n a l r e g i o n a l m i n i s t e r ' s r o l e . A c o m p a r i s o n i s made t o a t y p i c a l contemporary C a b i n e t M i n i s t e r on t h e p r a i r i e s ( O t t o Lang) t o document the - 52 -changed environment f a c e d by c u r r e n t C a b i n e t M i n i s t e r s . The r o l e p l a y e d by Mr. P e p i n i s not s p e c i f i c a l l y d i s c u s s e d ( t h i s i s done i n Chapter F i v e ) because he e v e n t u a l l y was t o be seen as a " p r a i r i e r e g i o n a l m i n i s t e r " even though he r e p r e s e n t e d a h i g h income urban r i d i n g i n Ottawa. 2.1.4 R o l e o f t h e C e n t r a l A g e n c i e s The p r e c e d i n g s e c t i o n d i s c u s s e s t h e r o l e of t h e C a b i n e t and t h e C a b i n e t M i n i s t e r i n p o l i c y development. T h i s s e c t i o n d e a l s w i t h another complex, c e n t r a l p o l i c y s t r u c t u r e , t h e C e n t r a l A g e n c i e s . The r o l e o f t h e C e n t r a l A g e n c i e s such as t h e Prime M i n i s t e r ' s O f f i c e (PMO), P r i v y C o u n c i l (PCO), T r e a s u r y Board (TB) and Department of F i n a n c e (FIN) w i l l be a n a l y z e d , p a r t i c u l a r l y s i n c e t h e s e a g e n c i e s were d i r e c t l y i n v o l v e d i n t h e Crow Rate debate. S i m i l a r a g e n c i e s are p a r t o f t h e p r o v i n c i a l governmental s t r u c t u r e . The f u n c t i o n of C e n t r a l A g e n c i e s ( f e d e r a l and p r o v i n c i a l ) i s t o p r o v i d e c o o r d i n a t i o n of government - 53 -programs and p r i o r i t i e s . N o t w i t h s t a n d i n g t h e f u n c t i o n a l r o l e of governments, A l a n C a i r n s b e l i e v e s t h e s i z e of government work f o r c e (1.2 m i l l i o n C a n a d i a n s ) 5 8 a f f e c t s t h e c a p a c i t y o f government t o make s o c i e t y r e s p o n s i v e t o i t s demands. 5 9 Thus c e n t r a l a g e n c i e s a r e e x p e c t e d not o n l y t o e s t a b l i s h p r o c e s s e s whereby p u b l i c p o l i c y can e v o l v e t h r o u g h th e maze of government departments but a l s o t o a d d ress t h e complex, economic i s s u e s c u r r e n t l y f a c i n g Canada. Each government i n Canada and governments i n o t h e r c o u n t r i e s has u n i q u e c e n t r a l a g e n c i e s . I n Canada, at the f e d e r a l l e v e l , t h e r e i s no one agency t h a t i s t o t a l l y r e s p o n s i b l e f o r c o o r d i n a t i o n a l t h o u g h a l l f o u r a g e n c i e s i n v o l v e d b e l i e v e t h e y are t h e prime agency. The a g e n c i e s i n v o l v e d a r e t h e Prime M i n i s t e r ' s O f f i c e (PMO), the P r i v y C o u n c i l O f f i c e (PCO), T r e a s u r y Board (TB) and F i n a n c e ( F I N . ) . S i n c e each of t h e o r g a n i z a t i o n s were i n v o l v e d i n t h e Crow Rate debate a s h o r t d e s c r i p t i o n o f each i s p r o v i d e d . P r i m e M i n i s t e r ' s O f f i c e PMO i s s t a f f e d by p e r s o n a l appointments o f t h e Prime M i n i s t e r . I t i s t h e most p a r t i s a n and ad hoc body. I t - 54 -p r o v i d e s p o l i t i c a l a d v i c e and i s c o n cerned on a day-to-day-b a s i s w i t h s u r v i v a l o f t h e government. I n r e c e n t y e a r s (1985) t h i s o f f i c e has grown i n s i z e t o o ver 100 o f f i c i a l s . P r i v y C o u n c i l O f f i c e The PCO i s s t a f f e d by c a r e e r p u b l i c s e r v a n t s and i t p r o v i d e s prime t e c h n i c a l a d v i c e t o t h e C a b i n e t and s e r v i c e s t h e v a r i o u s C a b i n e t Committees. The head of PCO i s t h e S e c r e t a r y t o t h e C a b i n e t and i s t h e most s e n i o r of a l l p u b l i c s e r v a n t s . The PCO c o n t r o l s C a b i n e t Committee agenda and c o o r d i n a t e s a l l b r i e f i n g s t o t h e Prime M i n i s t e r . These two o r g a n i z a t i o n s are somewhat unique t o Canada compared t o t h e White House i n Washington and No. 10 Downing S t r e e t i n London. Over t h e y e a r s b o t h t h e PMO and PCO saw t h e i r r o l e s s t r e n g t h e n e d and T horburn c o n c l u d e s , " . . . t h a t t h e Prime M i n i s t e r has been a b l e t o g i v e h i m s e l f a l t e r n a t i v e s o u r c e s of p o l i c y a d v i c e and t h u s make h i m s e l f l e s s dependent upon the s e n i o r p u b l i c s e r v a n t s . " 6 0 I n a d d i t i o n t h e Prime M i n i s t e r , as t h e Crow Rate debate w i l l d e m o n s t r a t e , has become l e s s dependent on P a r l i a m e n t and even h i s m i n i s t e r s . The PMO/PCO have become t h e e q u i v a l e n t o f " r e g i o n a l m i n i s t e r s " i n d i r e c t c o n f l i c t w i t h t h e P r e m i e r s who p o r t r a y t h e m s e l v e s as p r o v i d i n g r e g i o n a l - 55 -i n p u t i n p o l i c y development. For example i t i s t h e PMO/PCO w h i c h conduct most of t h e p o l l i n g t o d e t e r m i n e how each r e g i o n i s r e a c t i n g t o government i n i t i a t i v e s . The PMO and PCO a l s o m a i n t a i n l i a i s o n w i t h , c e n t r a l a g e n c i e s from t h e p r o v i n c e s . I n a d d i t i o n , PCO w i l l m a i n t a i n l i a i s o n w i t h key p r o v i n c i a l departments such as economic development and energy. PCO has e s t a b l i s h e d w o r k i n g r e l a t i o n s h i p s w i t h key s e c t o r s such as energy and n a t u r a l r e s o u r c e s . Large companies such as Canadian P a c i f i c L i m i t e d and Nova have d i r e c t a c c e s s t o t h e PCO. The PMO m a i n t a i n s l i n k s w i t h o f f i c i a l s i n t h e o f f i c e s of t h e v a r i o u s p r o v i n c i a l P r e m i e r s and o t h e r key p r o v i n c i a l d epartments. I n a d d i t i o n , PMO has d i r e c t a c c e s s t o t h e o f f i c i a l s i n t h e l o c a l c o n s t i t u e n c i e s of t h e p a r t y i n power. As a r e s u l t , b o t h PMO and PCO p r o v i d e t h e government w i t h a s e n s i t i v i t y as t o how p o l i c i e s a r e b e i n g a c c e p t e d or as t o t h e e x i s t e n c e of s u p p o r t f o r change. As w i l l be e l a b o r a t e d on l a t e r , b o t h t h e PMO and PCO c o n s i s t e n t l y a d v i s e d t h e Prime M i n i s t e r t h a t between 1980 and 1982 t h e r e was not a consensus i n w e s t e r n Canada t o "tamper" w i t h t h e Crow R a t e . - 56 -The o t h e r two groups i n c l u d e d as c e n t r a l a g e n c i e s i n Ottawa a r e F i n a n c e and T r e a s u r y Board. The Department of F i n a n c e i s r e s p o n s i b l e f o r macro-economic p l a n n i n g and t a x a t i o n and T r e a s u r y Board i s r e s p o n s i b l e f o r m o n i t o r i n g t h e e x p e n d i t u r e , by departments, of C a b i n e t approved programs. C o l i n Campbell i n h i s book Governments Under Stress61 s t a t e s t h a t t h e c e n t r a l a g e n c i e s i n Canada t e n d t o be l a r g e r t h a n t h o s e i n B r i t a i n and t h e U n i t e d S t a t e s and put more emphasis on p r i o r i t y - s e t t i n g . The s e n i o r p u b l i c s e r v a n t s i n Canada have g r e a t e r a c c e s s and c o l l e g i a l i t y w i t h C a b i n e t m i n i s t e r s t h a n do t h e i r c o u n t e r p a r t s i n B r i t a i n and t h e U n i t e d S t a t e s . As such t h e , " . . . s e n i o r o f f i c i a l s who work i n ( c e n t r a l a g e n c i e s i n Canada) a re among t h e most p o w e r f u l p u b l i c s e r v a n t s i n g o v e r n m e n t . 6 2 S i m i l a r a g e n c i e s may be found i n t h e t e n p r o v i n c i a l governments a l t h o u g h i n some c a s e s , n o t a b l y A l b e r t a , many of t h e PCO f u n c t i o n s a r e c a r r i e d out by t h e department of I n t e r g o v e r n m e n t a l R e l a t i o n s . I n Saskatchewan t h e PCO/PMO f u n c t i o n s a r e c a r r i e d out by t h e E x e c u t i v e C o u n c i l w h i c h was e s t a b l i s h e d i n 1944 by P r e m i e r Tommy Douglas t o d e v e l o p many o f t h e major s o c i a l programs e v e n t u a l l y adopted by t h e r e s t of t h e c o u n t r y such as M e d i c a r e . The c e n t r a l a g e n c i e s p l a y a s t r a t e g i c r o l e i n t h e - 57 -p r o c e s s of C a b i n e t a p p r o v a l . Figure 1: Process of Cabinet Approval p r o v i d e s an o v e r v i e w of how d e c i s i o n s a r e reached i n Ottawa. The p r o c e s s i s based on two p r i m a r y p r i n c i p l e s : 1) A l l m i n i s t e r s have t h e r i g h t t o b r i n g t o t h e i r c o l l e a g u e s p r o p o s a l s f o r government a c t i o n i n areas of 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 have 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 wh i c h t h e y w i l l s h a r e 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: P r o c e s s o f C a b i n e t A p p r o v a l Memorandum Cabinet Committee lo Cabinet Committee Report Cabinet or Prlor l t lat B Planning Record of Daclalon I Draft Briefing lor Chairman . Dapartmant 1 Pt Ivy Counci l Ol l ica Finance E conomlc A l l o t m e n t TB Secretariat Cost ing A l l o t m e n t r i 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 . | Mlnlatar TB Submission Treasury Board Dec is ion l e t t e r Dapartmant Secretariat Secretariat Note Source: Ian D. Clark, "Recent Changes in Cabinet Decision-Making", Canadian Public Administration. Vol. 28, 1985, p. 199. - 59 -As i n d i c a t e d i n Figure 1, t h e departments of F i n a n c e and T r e a s u r y Board l i a i s e w i t h t h e s u p p o r t i n g department on a program o r p o l i c y p r o p o s a l . I t i s t h e e s s e n t i a l r o l e o f t h e c e n t r a l a g e n c i e s t o ens u r e C a b i n e t committees have a c c e s s t o a l l t h e a p p r o p r i a t e i n f o r m a t i o n r e q u i r e d t o make a d e c i s i o n . PCO u s u a l l y s e t s t h e C a b i n e t committee agendas and can, t h r o u g h p r o c e s s , c o n t r o l t h e t i m i n g of p r o p o s a l s t o be c o n s i d e r e d by v a r i o u s C a b i n e t committees. T h i s i s a power PCO attemp t s t o e x p l o i t t o r e s o l v e any d i s p u t e s i t may have w i t h t h e s u p p o r t i n g m i n i s t e r o r department. I n p r e v i o u s y e a r s t h e r e were a d d i t i o n a l c o o r d i n a t i n g committees o p e r a t i n g , such as MSERD and MSSD, t h r o u g h w h i c h a l l p r o p o s a l s had t o pass b e f o r e r e a c h i n g C a b i n e t . Moreover, i n 1980 and as one of s e v e r a l i n i t i a t i v e s 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 of e l e c t o r a l r e p r e s e n t a t i o n i n t h e west, t h e y e s t a b l i s h e d y e t an o t h e r c o o r d i n a t i n g committee c a l l e d t h e Western A f f a i r s Committee c h a i r e d by L l o y d Axworthy, one of i t s two e l e c t e d members from w e s t e r n Canada. {This committee i s d i s c u s s e d i n Ch a p t e r F i v e . 2.1.5 R o l e o f I n t e r e s t Groups The purpose o f t h i s s e c t i o n i s t o d i s c u s s t h e r o l e o f s p e c i a l i n t e r e s t groups i n p u b l i c p o l i c y development. - 60 -S p e c i a l i n t e r e s t groups p l a y e d an i n t e g r a l p a r t i n t h e Crow Rate r e f o r m p r o c e s s . A purpose of t h i s t h e s i s i s t o dem o n s t r a t e t h e ways i n wh i c h t h e c o m b i n a t i o n of f e d e r a l i s m and i n t e r e s t groups c o n s t r a i n change. As a d e m o n s t r a t i o n of t h i s i n t e r a c t i o n , Jean-Luc P e p i n and h i s opponents b o t h e x p l o i t e d i n t e r e s t groups and were i n t u r n e x p l o i t e d by t h e s e groups t h e m s e l v e s . C h a p t e r F i v e a t t e m p t s t o answer t h e q u e s t i o n as t o how s u c c e s s f u l Mr. P e p i n ' s s t r a t e g y was but i t i s a l s o n e c e s s a r y t o g a i n some i n s i g h t from a t h e o r e t i c a l p e r s p e c t i v e as t o t h e r o l e of i n t e r e s t groups i n a f e d e r a l s t a t e such as Canada. A c c o r d i n g t o Doern and P h i d d " . . . i n t e r e s t groups compete w i t h p o l i t i c a l p a r t i e s and t h e media f o r t h e p r i v i l e g e o f i n t e r p r e t i n g t h e p u b l i c w i l l t o key d e c i s i o n m a k e r s . " 6 4 P r o s s d e f i n e s i n t e r e s t groups as o r g a n i z a t i o n s whose members a c t t o g e t h e r t o i n f l u e n c e p u b l i c p o l i c y i n o r d e r t o promote common i n t e r e s t . 6 5 Back i n 1974, Donald S m i l e y , a l o n g - t e r m c r i t i c of e x e c u t i v e f e d e r a l i s m as p r a c t i s e d i n Canada argued t h a t " . . . i t c o n t r i b u t e s t o s e c r e t , n o n - p a r t i c i p a t o r y and non-a c c o u n t a b l e p r o c e s s o f g o v e r n m e n t . " 6 6 U n t i l r e c e n t t i m e s , t h e r e f o r e , t h e C a n a d i a n p u b l i c - 61 -p o l i c y p r o c e s s tended t o be r e l a t i v e l y , c l o s e d . The dominant v i e w r e g a r d i n g a c c e s s of i n t e r e s t groups t o f e d e r a l - p r o v i n c i a l d e c i s i o n - m a k i n g p r o c e s s e s was t h a t of R i c h a r d Simeon, who i n t h e e a r l y 1970s argued t h a t : The m achinery ( o f 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 of i n t e r e s t groups i n t h e b a r g a i n i n g p r o c e s s . A f f e c t e d groups are not 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 iews known. The r e l a t i v e s e c r e c y of debate means i n t e r e s t group l e a d e r s may o f t e n be unaware of developments 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 w h i c h might i n v o l v e t h e m . 6 7 I n o t h e r words, he found t h a t i n t e r e s t groups are o f t e n f o r g o t t e n because governments t e n d t o r e g a r d o t h e r governments as t h e c r u c i a l a c t o r s . Simeon f u r t h e r argued t h a t "even when governments a c t as r e p r e s e n t a t i v e s of p a r t i c u l a r i n t e r e s t s , t h o s e i n t e r e s t s a r e l i k e l y t o be s a c r i f i c e d when t h e br o a d e r c o n c e r n s a r e i n v o l v e d . " 6 8 A good example of Simeon's Limited Access t h e o r y was i n 1981 when t h e Prime M i n i s t e r i n d i c a t e d t h a t any consensus on Crow Rate r e f o r m had t o i n c l u d e consensus among t h e t h r e e p r a i r i e P r e m i e r s . R i c h a r d S c h u l t z , on t h e b a s i s of h i s s t u d y on t h e t r u c k i n g i n d u s t r y i n O n t a r i o i n t h e e a r l y 1970s, d i s c o v e r e d - 62 -t h a t t h e r e a re o c c a s i o n s when i n t e r e s t i n t h e e n t i r e p r o c e s s and can " p l a y " a g a i n s t t h e o t h e r . H i s f i n d i n g s t h a t o f t e n i n v o l v e d i n an exchange governments l e n d s f u r t h e r s u p p o r t t o c r a c k t h e o r y . 6 9 A f t e r a l i t e r a t u r e s e a r c h F l e t c h e r and W a l l a c e c o n c l u d e d , " t h a t t h e i n s t i t u t i o n a l framework 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 i n f l u e n c e s t h e o p p o r t u n i t i e s a v a i l a b l e t o p a r t i c u l a r i n t e r e s t s t o s h a r e p o l i c y d e c i s i o n s . " 7 0 B a n t i n g argued 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 c o n t r a c t s t h e c i r c l e o f c r i t i c a l d e c i s i o n - m a k e r s , s t r u c t u r e s t h e n a t u r e o f p o l i t i c a l c o m p e t i t i o n , and s p e c i f i e s t h e form o f r e p r e s e n t a t i o n of t h e w i d e r p u b l i c , i t n e c e s s a r i l y c o n d i t i o n s t h e a c c e s s o f d i f f e r e n t p o l i t i c a l i n t e r e s t s t o p o l i c y -makers, smoothing t h e pathway of some and r a i s i n g o b s t a c l e s f o r o t h e r s . " 7 l F l e t c h e r and W a l l a c e b e l i e v e d t h a t was a p l a u s i b l e a s s u m p t i o n but t h e y were q u i c k t o add t h a t one s h o u l d be c a u t i o u s on making c o n c l u s i o n s i n t h i s a r e a . A c c o r d i n g t o S m i l e y : " I n t h e s t a t e o f our p r e s e n t knowledge we s h o u l d 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 s t a t e m e n t s about t h e r e l a t i o n between groups a r e i n v o l v e d one government o f f i n t e r e s t groups are r e l a t i o n s h i p w i t h G r o d z i n ' s m u l t i p l e - 63 -i n t e r e s t group a c t i v i t y and t h e p r o c e s s e s of e x e c u t i v e f e d e r a l i s m . Some p a t t e r n s 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 , such as t h o s e r e l a t e d t o t h e e q u a l i z a t i o n o f p r o v i n c i a l revenues, appear t o i n v o l v e governments almost e x c l u s i v e l y , I n o t h e r c i r c u m s t a n c e s f o r e x a m p l e . . . ( r e g u l a t o r y i s s u e s ) , i n t e r e s t groups are much more i n f l u e n t i a l . And i n y e t o t h e r s i t u a t i o n s , such as (energy p r i c i n g ) , t h e r e l a t i v e i n f l u e n c e of i n t e r e s t groups i n i n t e r -g o v ernmental n e g o t i a t i o n s may change q u i c k l y and d r a m a t i c a l l y . " 7 2 F l e t c h e r and W a l l a c e i d e n t i f i e d t h r e e f a c t o r s w h i c h can a l l o w i n t e r e s t groups t o acc e s s p o l i c y d e c i s i o n s . 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 concerned w i t h i n t e r e s t group i n v o l v e m e n t when major p o l i c y i s s u e s a r e b e i n g d i s c u s s e d . 2. I n t e r e s t groups 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 or more of t h e governments i n v o l v e d r e q u i r e t h e i r s u p p o r t . 3. I n h i g h l y t e c h n i c a l a r e a s , i n t e r e s t groups r e p r e s e n t a t i v e s w i l l s e r v e as a member of a f e d e r a l / p r o v i n c i a l d e l e g a t i o n . 7 3 As i s demonstrated i n t h i s t h e s i s , governments t h e m s e l v e s o f t e n seek t o m o b i l i z e i n t e r e s t group a c t i v i t y i n s u p p o r t o f t h e i r p o s i t i o n s . E x t e r n a l p r e s s u r e can h e l p t o g e t an i s s u e on t h e f e d e r a l - p r o v i n c i a l agenda and t h e - 64 -r o l e of i n t e r e s t groups t o t r i g g e r Crow Rate r e f o r m was s i g n i f i c a n t . 2.1.6 R o l e of t h e Media In k e e p i n g w i t h t h e theme of t h i s c h a p t e r , w h i c h i s t o i d e n t i f y t h e key i n s t i t u t i o n s w h i c h must be u n d e r s t o o d t o be a b l e t o d e t e r m i n e t h e i r r o l e i n p o l i c y development, t h i s s e c t i o n d i s c u s s e s t h e r o l e of t h e media. The media p l a y e d a major p a r t i n the Crow Rate r e f o r m and i t i s n e c e s s a r y t o e s t a b l i s h what r o l e t h e media p l a y s i n p o l i c y development. A c c o r d i n g t o J . D. F o r b e s , t h e r o l e of t h e media i s " . . . t o d e f i n e t h e problems and agendas under c o n s i d e r a t i o n , t o communicate i n f o r m a t i o n about t h e s e m a t t e r s and t o a m p l i f y t h e i s s u e s . " 7 4 Whether or not t h i s i s t r u e , i t i s d i f f i c u l t t o measure how e f f e c t i v e t h e mass media i s i n meet i n g t h e s e t a s k s . I t i s a l s o d i f f i c u l t t o e s t a b l i s h how i n t e r e s t e d Canadians are i n g a i n i n g knowledge t h r o u g h t h e media. Doern and P h i d d b e l i e v e t h e media a r e " i n t e r e s t e d f i r s t i n 'news', f e e d on t h e p a r t i s a n s h i p of th e House o f Commons and on t h e p e r s o n a l i t i e s w i t h i n i t . I s s u e s and i d e a s a r e not t o t a l l y i g n o r e d but t h e a t t e n t i o n span o f t h e media . .. produces an o f t e n l u d i c r o u s s h o r t run t i m e f r a m e . " 7 5 - 65 -Not o n l y does th e media r e p o r t t h e news but i t a l s o h e l p s t o shape i t by t h e amount of t i m e i t d e v o t e s t o an i s s u e . An u n d e r s t a n d i n g of t h e media i s e s s e n t i a l because we depend almost c o m p l e t e l y on t h e mass media f o r our i n f o r m a t i o n about th e p o l i t i c a l w o r l d and t h e development of p u b l i c p o l i c y . As i s demonstrated i n C h a p t e r F i v e , we do not always b e l i e v e what we read or hear but t h e mass media has a g r e a t i n f l u e n c e on t h e way we l o o k a t t h e w o r l d . A c c o r d i n g t o Eugene Hallman, who has worked f o r many y e a r s i n t h e Canadian media: " P u b l i s h e r s are d e a l i n g i n power, 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 , t o p r o v i d e a f r e e range of o p i n i o n , or t o p r o v i d e some of 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 heat i t up...The f r o n t page and t h e e d i t o r i a l page announce what and who a r e i m p o r t a n t and why t h e y a r e . " 7 6 T h i s r a i s e s t h e q u e s t i o n about p r e s s o w n e r ship S i n c e 1914 t h e r e has 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 o f newspapers i n Canada. Today o n l y f o u r companies produce 80 per c e n t of a l l t h e newspapers i n E n g l i s h - s p e a k i n g Canada. C o n c e n t r a t i o n a l s o . r a i s e s t h e q u e s t i o n o f e d i t o r i a l freedom. As w i l l be documented i n C h a p t e r F i v e - p r e s s o w n e r s hip (many of t h e major a g r i c u l t u r a l o r g a n i z a t i o n s i n - 66 -t h e west produced t h e i r own newspaper) and e d i t o r i a l s p l a y e d a s i g n i f i c a n t r o l e i n t h e Crow Rate debate. A f t e r a d e t a i l e d s t u d y of t h e media, F l e t c h e r (1981) o b s e r v e d : " R e s e a r c h e r s are agreed... t h a t t h e news media, t h r o u g h t h e i r s e l e c t i o n and p r e s e n t a t i o n of news, can r e i n f o r c e v o t i n g d e c i s i o n s , h e l p t o form images of l e a d e r s 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 of i s s u e s and t h e tone o f t h e campaign, a l l i n ways t h a t may work t o t h e advantage o f one p a r t y o r t h e o t h e r . " 7 7 A n o t h e r u n i q u e s i t u a t i o n i n w e s t e r n Canada was t h e f a c t t h a t few c i t i e s i n t h e west have more t h a n one newspaper or r a d i o and T.V. s t a t i o n . Many of t h e communities i n t h e p r a i r i e s produce o n l y a w e e k l y newspaper w h i c h i s dependent on governments f o r a d v e r t i s i n g . These newspapers have a s m a l l s t a f f w h i c h does not a l l o w t h e a n a l y s i s o f news s t o r i e s t o be p r e s e n t e d . Government p r e s s r e l e a s e s , i f t h e y are p r i n t e d , u s u a l l y w i l l not be e d i t e d . The p o l i c y i n l a r g e r c i t i e s i s t o c o n c l u d e t h a t a government p r e s s r e l e a s e i s s l a n t e d t o f a v o u r t h e government's p o s i t i o n and i t i s u s u a l l y i g n o r e d . - 67 -C h a p t e r F i v e examines t h e impact of t h e media on t h e Crow Rate d e b a t e . S p e c i a l emphasis i s made on whether t h e "w e s t e r n " media were b i a s e d i n f a v o u r o f p r o v i n c i a l P r e m i e r s and t o t h e manner i n w h i c h t h e "f a r m e r " owned newspapers c o v e r e d t h e Crow i s s u e . The more i m p o r t a n t q u e s t i o n a d d r e s s e d i n Chapter F i v e i s t o what degree t h e a v a i l a b i l i t y o f more i n f o r m a t i o n w i l l produce e f f i c i e n t c o m p e t i t i o n , as advocated by t h e Macdonald R o y a l Commission. .The Commission b e l i e v e d t h a t a r e s t r i c t i o n of e x e c u t i v e f e d e r a l i s m , w h i c h i n c l u d e s f e d e r a l - p r o v i n c i a l communications t o be ac c o r d e d a s t a t u s e q u a l t o n a t i o n a l s e c u r i t y , s h o u l d be removed. As i s shown i n Ch a p t e r F i v e , t h e r e was no s h o r t a g e of i n f o r m a t i o n r e l a t e d t o t h e Crow Rate but even t h o s e most a f f e c t e d had d i f f i c u l t y i n u n d e r s t a n d i n g t h e b a s i c reasons as t o why t h e f r e i g h t r a t e had t o be changed. I n a d d i t i o n not a l l s t u d i e s , even i n one i n s t a n c e f e d e r a l - p r o v i n c i a l funded s t u d i e s , were not made a v a i l a b l e t o t h e p u b l i c . (See Pages 152-158). 2.1.7 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 The p r e v i o u s s e c t i o n s i n t r o d u c e t h e s t r u c t u r e s and i n s t i t u t i o n s o f government w h i c h a f f e c t p o l i c y development. A l s o i d e n t i f i e d a r e t h e emerging r o l e s of - 68 -i n t e r e s t groups and t h e media i n b e i n g used t o i n f l u e n c e t h a t p o l i c y development. T h i s s e c t i o n i s dev o t e d t o exa m i n i n g t h e r o l e of i n t e r e s t group a c t i v i t y i n i n t e r g o v e r n m e n t a l n e g o t i a t i o n s . I n r e v i e w i n g t h e l i t e r a t u r e r e l a t e d t o t h i s a r e a , i t i s o b v i o u s t h a t t h e r e i s a p a u c i t y o f a v a i l a b l e d o c u m e n t a t i o n . 7 8 T h i s t h e s i s a t t e m p t s t o f i l l some of t h e s e gaps. Two e a r l i e r t h e s e s have been d e v e l o p e d w h i c h t e s t e d t h e r e l a t i o n s h i p between i n t e r e s t groups and f e d e r a l s t r u c t u r e s and p r o c e s s e s . The f i r s t t h e s i s examined i s t h e work u n d e r t a k e n by Morton G r o d z i n . 7 9 H i s Multiple-Crack t h e s i s contends t h a t t h e f e d e r a l systems a re p a r t i c u l a r l y v a l u e d by i n t e r e s t groups s i n c e t h e e x i s t e n c e of two l e v e l s of government, even w i t h s h a r e d powers, p r o v i d e m u l t i p l e a c c e s s p o i n t s t o pursue p o l i c y development. A consequence o f t h e Multiple-Crack t h e o r y i s t h a t i n t e r e s t groups can p l a y one l e v e l o f government a g a i n s t t h e o t h e r . G r o d z i n d e v e l o p e d t h i s t h e s i s based on t h e American p o l i t i c a l s ystems. The second h y p o t h e s i s i s based on t h e work of - 69 -R i c h a r d Simeon. S i m e o n 8 0 c o n c l u d e s t h a t whatever t h e v a l u e of f e d e r a l systems a c c r u i n g t o groups i n terms of g e n e r a l a c c e s s t o p o l i c y - m a k e r s , t h e n a t u r e of Canadian f e d e r a l i s m i s such t h a t , when an i s s u e e n t e r s t h e arena of i n t e r - g overnmental n e g o t i a t i o n s , group a c c e s s becomes s e v e r e l y r e s t r i c t e d . H i s argument i n s u p p o r t of t h e Limited Access Model i s t h a t t h e machinery of i n t e r -g o v e r n m e n t a l 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 of i n t e r e s t groups i n t h e b a r g a i n i n g p r o c e s s . A f f e c t e d groups a r e not 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 of debate means group l e a d e r s may be unaware of development 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 w h i c h i n v o l v e . t h e m . " 8 1 R i c h a r d S c h u l t z t e s t e d t h e g e n e r a l Multiple-Crack h y p o t h e s i s and t h e more s p e c i f i c Simeon h y p o t h e s i s on t h e r e s t r i c t e d a c c e s s and l i m i t e d e f f e c t i v e n e s s o f i n t e r e s t g r o u p s , by u n d e r t a k i n g a case s t u d y o f i n t e r e s t group a c t i v i t i e s d u r i n g t h e development of t h e National Transportation Act 1967. 8 2 S c h u l t z examined t h e r o l e of t h e Cana d i a n T r u c k i n g A s s o c i a t i o n (CTA) i n t h e i n t e r g o v e r n m e n t a l n e g o t i a t i o n s on P a r t I I I o f t h e T r a n s p o r t A c t . The National Transportation Act 1967 was b e i n g promoted as a major b r e a k w i t h - 70 -e a r l i e r t r a n s p o r t a t i o n r e g u l a t i o n s i n Canada w h i c h , as w i l l be d i s c u s s e d i n Chapter Three, was p r i m a r i l y d i r e c t e d t o t h e r a i l w a y s , The MacPherson Commission i n T r a n s p o r t a t i o n (1960) had recommended t h a t Canada s h o u l d adopt a more i n t e r - m o d a l framework f o r t r a n s p o r t a t i o n development. T h i s meant p l a c i n g a l l modes o f t r a n s p o r t under a s i n g l e r e g u l a t o r y a u t h o r i t y , t h e Canadian T r a n s p o r t Commission. The r e s p o n s i b i l i t y f o r r e g u l a t i n g t h e e x t r a - p r o v i n c i a l motor c a r r i e r i n d u s t r y had been d e l e g a t e d by t h e f e d e r a l government t o t h e p r o v i n c e s i n 1954. The p r o v i n c e s , p a r t i c u l a r l y O n t a r i o , d i d not r e l i s h t h e c o n c e p t o f g i v i n g up i t s a u t h o r i t y . S c h u l t z o u t l i n e d t h e e f f o r t s o f t h e f e d e r a l government t o w i n t h e CTA t o i t s s i d e and l i k e w i s e examined t h e at t e m p t s by O n t a r i o t o c o n v i n c e t h e t r u c k i n g a s s o c i a t i o n t o s t a y under p r o v i n c i a l j u r i s d i c t i o n . A f t e r f i v e y e a r s of c o n f l i c t , t h e p r o v i n c e s won and P a r t I I I was not implemented. However, t h e CTA's s u p p o r t f o r t h e p r o v i n c e s p r o b a b l y l e d t h e A s s o c i a t i o n t o b e l i e v e t h a t i t got 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 , S c h u l t z c o n c l u d e d t h a t : 1. The Multiple-Crack h y p o t h e s i s needs t o be q u a l i f i e d because i t f a i l s t o g i v e s u f f i c i e n t w e i g h t t o t h e c o s t s o f a f e d e r a l system f o r an i n t e r e s t group. 2. Simeon's Limited Access Model n e g l e c t s t h e i m p o r t a n t s u p p o r t f u n c t i o n i n i n t e r g o v e r n m e n t a l n e g o t i a t i o n s . - 71 -Group 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 the b a r g a i n i n g powers and c o n s e q u e n t l y groups may p l a y a much more extended and i n f l u e n t i a l r o l e i n t h e p r o c e s s . 8 3 S c h u l t z i d e n t i f i e d t h e need f o r more r e s e a r c h on t h e 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 b a r g a i n i n g p r o c e s s . A c c o r d i n g t o him, i n t e r e s t groups can e x p l o i t t h e m u l t i p l e a c c e s s p o i n t s of i n t e r g o v e r n m e n t a l n e g o t i a t i o n s but t h e p r i c e of t h i s may be t o become i n t e r t w i n e d i n "the 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 i n t e r e s t i n e x a m i n i n g t h e r o l e and scope of i n t e r e s t groups i n t h e Canadian f e d e r a l system. However, a n a l y s i s o f t h e i n t e r -r e l a t i o n s of t h e two dynamics remains, a c c o r d i n g t o Hugh Th o r b u r n , " l a r g e l y u n e x p l o r e d " . 8 5 I n h i s work f o r t h e Macdonald R o y a l Commission on t h e Economy, 1985, Tho r b u r n d i d i d e n t i f y f u r t h e r e v i d e n c e f o r t h e m u l t i p l e - c r a c k t h e o r y i n Case S t u d i e s by K r a v n i c k and B u c o v e t s k y . K r a v n i c k ' s Study uses t h e c o n f l i c t between t h e Canadian Labor Congress and t h e C o n f e d e r a t i o n o f N a t i o n a l Trade U n i o n s , t o demonstrate t h a t r i v a l g r o u p s , r e p r e s e n t i n g t h e same i n t e r e s t s but h a v i n g a c c e s s t o d i f f e r e n t l e v e l s o f government i n a f e d e r a l system, w i l l attempt t o s h i f t power t o t h e l e v e l of government t o w h i c h t h e y e n j o y a c c e s s . B u c o v e t s k y shows how t h e m i n i n g i n d u s t r y was s u c c e s s f u l i n m o b i l i z i n g p r o v i n c i a l governments a g a i n s t - 72 -t h e p r o p o s a l of t h e C a r t e r Commission on T a x a t i o n . 8 6 The t h i r d c a s e s t u d y d i s c u s s e d by Th o r b u r n , i s t h e work a l r e a d y d i s c u s s e d by S c h u l t z . T h i s c l e a r l y d e m o n s t r a t e s how l i t t l e work has been c o m p l e t e d on a s u b s t a n t i v e c a s e s t u d y b a s i s t o examine t h e r o l e o f i n t e r e s t groups i n t h e Canadian f e d e r a l system. T h i s t h e s i s b u i l d s on t h e e a r l i e r s t u d i e s o f p u b l i c p o l i c y f o r m u l a t i o n s . I t examines t h e r o l e and scope of w e s t e r n a g r i c u l t u r a l and t r a n s p o r t a t i o n groups t o i n f l u e n c e t h e f e d e r a l government's attempt t o change t h e Crow R a t e , as a t e s t t o f u r t h e r examine t h e a p p l i c a b i l i t y of t h e Mutiple-Crack and Limited Access h y p o t h e s e s . The key f e a t u r e f o r Crow Rate r e f o r m , was t h e agreement between t h e f e d e r a l government and t h e major i n t e r e s t groups 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 and o u t s i d e c a t e g o r y f o r i n t e r e s t groups and governments i n t h e n e g o t i a t i o n o f a Crow Rate s e t t l e m e n t . These n e g o t i a t i o n s a r e d e v e l o p e d i n t h e form o f a model i n Ch a p t e r F i v e . Summary T h i s s e c t i o n o u t l i n e s t h e s t r u c t u r e o f t h e Can a d i a n p o l i t i c a l system and p r o v i d e s some i n s i g h t as t o how p u b l i c p o l i c y i s f o r m u l a t e d i n Canada. - 73 -The t r a d i t i o n a l c o ncept of f e d e r a l i s m i s r e v i e w e d w i t h p r o v i n c e - b u i l d i n g a p p e a r i n g as an i m p o r t a n t theme i n t h a t r e v i e w . The ongoing c o n f l i c t between f e d e r a l and p r o v i n c i a l governments i s i d e n t i f i e d 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 . The Can a d i a n C a b i n e t system i s a n a l y z e d as i s t h e h i s t o r i c a l r o l e o f t h e r e g i o n a l m i n i s t e r . I t i s argued t h a t t h i s " r e g i o n a l " r o l e has been o v e r t a k e n and t o a l a r g e e x t e n t performed by p r o v i n c i a l P r e m i e r s . The d e c l i n e o f t h e L i b e r a l P a r t y i n w e s t e r n Canada i a documented between t h e y e a r s 1953 and 1980. T h i s d e c l i n e can be viewed as p a r t of a l a r g e r phenomenon 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 r o l e s o f t h e c e n t r a l a g e n c i e s such as t h e P r i v y C o u n c i l O f f i c e a r e r e v i e w e d s i n c e t h e s e a g e n c i e s p r o v i d e c o o r d i n a t i o n of government programs and p r i o r i t i e s . I t i s c o n c l u d e d t h a t t h e PMO/PCO have become t h e e q u i v a l e n t of r e g i o n a l m i n i s t e r s i n d i r e c t c o n f l i c t w i t h f e d e r a l C a b i n e t M i n i s t e r s and w i t h p r o v i n c i a l P r e m i e r s i n n a t i o n a l d e c i s i o n making. The c h a p t e r a l s o i n t r o d u c e s t h e r o l e o f s p e c i a l - 74 -i n t e r e s t groups and t h e media i n p u b l i c p o l i c y development. The i n t e r a c t i v e e f f e c t s between i n t e r e s t groups and f e d e r a l i s m i s a c e n t r a l theme of t h i s t h e s i s . U n t i l r e c e n t l y t h e Canadian p u b l i c p o l i c y p r o c e s s was r e l a t i v e l y c l o s e d and r e s t r i c t e d t o 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 . T h i s i s no l o n g e r t h e c a s e and i n t e r e s t g r o u p s , t h a n k s t o a l a r g e degree by t h e exposure s u p p l i e d by t h e media, have been a b l e t o e x p l o i t t h e c o n f l i c t between t h e f e d e r a l and p r o v i n c i a l governments. As w e l l , each l e v e l of government i s p r e p a r e d t o m o b i l i z e i n t e r e s t groups a c t i v e l y i n s u p p o r t of t h e i r p o s i t i o n s . The next c h a p t e r d i s c u s s e s how t h e two l e v e l s of government i n Canada i n t e r a c t t o d e v e l o p and implement 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 i e s . - 75 -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. 3Ibid. p. 119. ^Christopher Armstrong, The Politics of Federalism. University of Toronto Press, Toronto, 1981, p. 34. $Hugh G. Thorburn, Interest Groups, p. 17. 6Alan Cairns, "The Other Crisis of Canadian Federalism", Canadian Public  Administration. Vol. 22, No.2, 1979, p. 180. ?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 Society: Regionalism in Decline. Butterworth, Toronto, 1980, p. 2. ^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 Perspective on Canadian Federalism", Canadian Public Administration. Volume IX, March 1966, quoted in Roger Gibbins' Prairie Politics, p. 3. 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 Simeon, Confrontation and Collaboration, p. 7. 15Ibid. p. 7. 16Alan Cairns, "The Other Crisis of Canadian Federalism", p. 194. - 76 -NOTES Page 2 of 6 ^Richard Simeon, Federal Provincial Diplomacy. University of Toronto Press, Toronto, 1972, p. 230. 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 Collaboration- Intergovernmental  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. 22Ibid. p. 285. 23Edwin R. Black and Alan Cairns, "A Different Perspective on Canadian Federalism", in J. Peter Meekison, ed., op. cit. p. 83. E. Hodgetts, op. cit. p. 285. 2$Garth Stevenson, Unfulfilled Union. Gage Publishing Ltd., Toronto, 1982, p. 174. 26Ibid. Page 174. 2?Richard Simeon, Federal-Provincial Diplomacy. University of Toronto Press, Toronto, 1972,p. 172. 2&Jean-Luc Pepin, "Cooperative Federalism", The Canadian Forum. Dec, 1964, p. 206. ^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 Page 3 of 6 3^Audrey D. Doerr, The Machinery of Government in Canada. Methuen, Toronto, 1981, p. 181. ^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. 33Ibid. p. 154. 34Ibid. p. 154. 35Ibid. p. 155. 3&Audrey Doerr op. cit p. 181 3^Ian D. Clark, "Recent Changes to the Cabinet Decision- Making System in Ottawa", Canadian Public Administration. Vol. 28, No. 2, 1985, p. 201. 38Ibid. p. 188. 3^David 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. 41Ibid. p. 190. 42David E. Smith, op. cit.. p. 355. 43W. A. Matheson, The Prime Minister and the Cabinet. Methuen, Toronto, 1976, p. 97. 44peter 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. 45Richard Simeon, "Regionalism and Canadian Political Institutions", p. 299. - 78 -NOTES Page 4 of 6 46Alan Cairns, From Interstate to Intrastate Federalism in Canada. Institute of Intergovernmental Relations, Queen's University, Kingston, 1979, p. 6. 47John 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. 52Ibid. p. 76. 53Ibid. p. 79. 54Ibid. 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: Liberals on the  Prairies. University of Toronto Press, Toronto, 1981. 5?Barry Wilson, Politics of Defeat - The Decline of the Liberal Party in  Saskatchewan. Western Producer Prairie Books, Saskatchewan, 1980. 58Macdonald 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 Under Stress. University of Toronto Press, Toronto, 1983. 62colin Campbell and George Szablowski, The Super Bureaucrats. MacMillan, Toronto, 1979, p. 1. 6han D. Clark, "Recent Changes in Cabinet Decision-Making", p. 198. - 79 -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. 68Ibid. v. 178. 69Ibid. p. 178. 70Ibid. p. 178. 71Ibid. p. 178. 72Ibid. pp. 178-179. 73Ibid. p. 181. 74Jim Forbes, "Institutions and Influence Groups in Canadian Farm and Food Policy", Institute of Public Administration for Canada. Monograph No. 10, 1985. 7^Doern and Phidd, op. cit. p. 547. 7^Ricker, Saywell and Skeach, op. cit. p. 98. 77lbid. p. 100. 78The 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. - 80 -NOTES Page 6 of 6 ^Morton Grodzin, "The Federal System", op. cit. ^Richard Simeon, Federal-Provincial Diplomacy. University of Toronto Press, Toronto, 1972. 81Ibid, p. 144.. 82Richard 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. 83Ibid, p. 394. 84Ibid, p. 394. 8$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. 86Ibid, p. 62. - 81 -CHAPTER THREE THE DEVELOPMENT OF NATIONAL TRANSPORTATION POLICY 3.0 Introduction I t i s n e c e s s a r y t o t r a c e t h e e v o l u t i o n o f t r a n s -p o r t a t i o n p o l i c y i n Canada because i t p r o v i d e s an i d e a l o p p o r t u n i t y t o a s s e s s t h e problems of p o l i c y - m a k i n g i n a f e d e r a l s t a t e . The c h a p t e r o u t l i n e s t h e sha r e d r e s p o n s i b i l i t i e s between t h e two l e v e l s o f government and d i s c u s s e s some of t h e problems t h i s has c r e a t e d . The c h a p t e r p r e s e n t s an argument t h a t s i n c e C o n f e d e r a t i o n t h e Canadian t r a n s p o r t system has had a d u a l purpose. On t h e one hand, i t i s e x p e c t e d t o p r o v i d e an e f f i c i e n t and h i g h l e v e l s e r v i c e a t " r e a s o n a b l e " c o s t and on t h e o t h e r hand, i t i s e x p e c t e d t o be an " i n s t r u m e n t o f n a t i o n a l p u r p ose." I n c l u d e d i n t h e c h a p t e r i s a h i s t o r i o g r a p h y o f r a i l w a y development and t h e c o n c o m i t a n t emergence o f g r a i n - 82 -h a n d l i n g and t r a n s p o r t problems. The e v o l u t i o n of 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 , w i t h r e f e r e n c e t o many of t h e c o n t r a s t i n g r o l e s imposed upon i t , w i l l a l s o be o u t l i n e d i n t h i s c h a p t e r . Emphasis i s p l a c e d on t h e r o l e of governments and governments' prime i n s t r u m e n t s - r e g u l a t i o n and l e g i s l a t i o n - t o document how t h e t r a n s p o r t p o l i c y has e v o l v e d s i n c e 1867. The c h a p t e r b e g i n s w i t h a c o n t e x t s e c t i o n t o i d e n t i f y t h e u n i q u e f e a t u r e s o f t r a n s p o r t a t i o n i n Canada. 3.1 The Ca n a d i a n T r a n s p o r t a t i o n System I t i s common t o b e g i n any r e f e r e n c e t o t r a n s p o r t a t i o n i n Canada by i n v o k i n g a h y p e r b o l e t o d e s c r i b e how s i g n i f i c a n t t r a n s p o r t a t i o n i s t o t h e w e l l - b e i n g o f Ca n a d i a n s . Canada's immense t e r r i t o r y ( second o n l y t o t h e S o v i e t Union) w i t h a p o p u l a t i o n of o n l y 25 m i l l i o n , i s r e a l l y an "empty c o u n t r y " 1 , w h i c h poses an awesome r o l e on th e t r a n s p o r t system t o move goods and p e o p l e over 4,000 m i l e s between V i c t o r i a , B r i t i s h Columbia and S t . Johns, Newfoundland and t h r o u g h s i x t i m e zones. I t can be s a i d t h a t 2 as t h e w o r l d ' s s e v e n t h l a r g e s t t r a d i n g n a t i o n Canada 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 system. As a r e s u l t , - 83 -"...on a per c a p i t a b a s i s , Canada has many more m i l e s o f r a i l w a y m a i n l i n e (1971) as does t h e U n i t e d S t a t e s and has 40 per c e n t more m i l e s of s u r f a c e d r o a d . " 3 A c c o r d i n g t o t h e S c i e n c e C o u n c i l o f Canada, " . . . t h i s c o u n t r y i s t h e second most a c t i v e a v i a t i o n c o u n t r y i n t h e w o r l d . " 4 I t i s a l s o p o s s i b l e t o s t a t e t h a t , from a d e r i v e d demand p e r s p e c t i v e , a p p r o x i m a t e l y 607 m i l l i o n tonnes of f r e i g h t were moved and a p p r o x i m a t e l y 325 m i l l i o n i n t e r c i t y p a s s e n ger t r i p s were t a k e n i n 1 983. 5 However, i t s h o u l d a l s o be p o i n t e d out t h a t i t was not u n t i l May, 1971 t h a t a s i n g l e n a t i o n a l highway, y e t a l o n e highway system, was e s t a b l i s h e d . I t was l e s s t h a n twenty y e a r s ago t h a t t h e n a t i o n a l bus r o u t e e a s t w a r d a c r o s s Canada i n c l u d e d a d i v e r s i o n s o u t h of W i n n i p e g , t h r o u g h M i n n e a p o l i s , C h i c a g o and D e t r o i t . Even t o d a y t h e r e i s no n a t i o n a l bus company and a l t h o u g h i t i s p o s s i b l e t o t r a v e l by bus between V i c t o r i a , B.C., and S t . J o h n ' s , Newfoundland, such a t r i p w i l l r e q u i r e s e v e r a l bus t r a n s f e r s owned by d i f f e r e n t companies. I n 1940 about 150,000 p e r s o n s used c o m m e r c i a l p l a n e s i n Canada. I n 1984 about 28.5 m i l l i o n ( a l m o s t d o u b l e t h e 1970 f i g u r e ) p a s s e n g e r s were c a r r i e d by c o m m e r c i a l a i r l i n e s , y e t i t i s s t i l l i m p o s s i b l e t o f l y d i r e c t between any o f t h e f o u r w e s t e r n p r o v i n c i a l c a p i t a l s and any o f t h e f o u r A t l a n t i c - 84 -p r o v i n c i a l c a p i t a l s . I n o t h e r words, t h e Canadian 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 o f c o n t r a s t s . The t r a n s p o r t a t i o n system i n Canada as i n d i c a t e d above i s b o t h a l a r g e , e f f i c i e n t and a l i m i t e d , immature system. The system has as w e l l undergone major s t r u c t u r a l changes w i t h t h e r e s u l t t h a t t h e r a i l mode, w h i c h a t one t i m e p r o -v i d e d t h e b u l k of f r e i g h t and passenger s e r v i c e s i n Canada, i s now p r i m a r i l y a c a r r i e r of low v a l u e , b u l k c o m m o d i t i e s . I n t u r n , t h e passenger c a r was r e s p o n s i b l e f o r 85 per c e n t of a l l i n t e r c i t y passenger t r a f f i c i n 1 9 8 3 . 6 T h i s i s not s u r p r i s i n g when one c o n s i d e r s t h a t i n 1940, Canadians owned 1.2 m i l l i o n c a r s 7 , and today t h e y own a p p r o x i m a t e l y 11.0 m i l l i o n c a r s . AS a r e s u l t , passenger t r a v e l on r a i l w a y s has d e c r e a s e d from 22 m i l l i o n p a s s e n g e r s i n 1 9 4 0 8 t o 7 m i l l i o n t o d a y . 9 3.1.1 R a i l w a y I d e o l o g y I t i s not d i f f i c u l t t o u n d e r s t a n d why t h e Canadian t r a n s p o r t a t i o n system i s f u l l o f c o n f l i c t i n g d u a l i s m s when one a t t e m p t s t o p r o v i d e an h i s t o r i c a l p e r s p e c t i v e on t h e e v o l u t i o n o f 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 . A p l a n f o r r a i l w a y development i s o f t e n c i t e d as one o f t h e key - 85 -elements of John A. MacDonald's N a t i o n a l P o l i c y . * However, i t i s becoming i n c r e a s i n g l y e v i d e n t t h a t t h e r e has been c o n s i d e r a b l e mythology s u r r o u n d i n g b o t h t h e f o r m a t i o n and purpose o f t h i s p o l i c y . G e r a l d F r i e s e n , who has r e c e n t l y produced t h e f i r s t r e g i o n a l h i s t o r y o f t h e p r a i r i e s , argues from a contemporary p o s i t i o n t h a t t h e N a t i o n a l P o l i c y , was not j u s t t h e c r e a t i o n of John A. MacDonald but r a t h e r was e s t a b l i s h e d i n t h e g e n e r a t i o n b e f o r e and t h e f i r s t two g e n e r a t i o n s a f t e r C o n f e d e r a t i o n . A c c o r d i n g t o F r i e s e n , i t was t h e b u s i n e s s i n t e r e s t s who worked t o g e t h e r t o ens u r e t h a t t h e o u t l y i n g r e g i o n s b e n e f i t e d c e n t r a l Canada. There i s no a c t u a l d a t e when t h e N a t i o n a l P o l i c y was e s t a b l i s h e d . F r i e s e n s t a t e s t h a t N a t i o n a l P o l i c y i s synonymous w i t h C o n f e d e r a t i o n (1867) s i n c e he argues t h a t C o n f e d e r a t i o n , " . . . i t s e l f was a p l a n k i n t h e e n t r e p r e n e u r s ' e f f o r t s t o make t h e n a t i o n " s t r o n g " but t h e i r e f f o r t s may a l s o have p e n a l i z e d t h e o u t l y i n g r e g i o n s t o t h e b e n e f i t o f c e n t r a l Canada. A c c o r d i n g t o F r i e s e n businessmen needed economic growth and t h e Canadian n o r t h w e s t was t h e f i e l d of i n v e s t m e n t . 1 0 H a r o l d I n n i s 1 1 ( a u t h o r o f t h e s t a p l e - h i n t e r l a n d *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 economist Vernon F o w k e 1 2 argued i n 1957 t h a t N a t i o n a l P o l i c y was t h e r e s u l t of t h e e s t a b l i s h m e n t of th e T a r i f f i n 1879. The t a r i f f added a 15 per c e n t ad volorem on each i m p o r t e d i t e m . A c c o r d i n g t o F r i e s e n 1 3 t h e immediate r e s u l t was t o b e n e f i t t h e m a n u f a c t u r i n g r e g i o n s of Canada a t t h a t t i m e ( T o r o n t o and M o n t r e a l umland). These r e g i o n s b e n e f i t t e d from t h e i n c r e a s e d number of j o b s and from t h e d e c r e a s e i n p o p u l a t i o n s h i f t t o t h e U n i t e d S t a t e s . Over t i m e t h e i n h a b i t a n t s of t h e f o u r w e s t e r n and t h r e e m a r i t i m e p r o v i n c e s as w e l l as n o r t h e r n O n t a r i o and n o r t h e r n Quebec p a i d h i g h e r p r i c e s f o r "Canadian goods". I n n i s b e l i e v e d t h a t t h e t a r i f f was t h e l y n c h p i n o f t h e N a t i o n a l P o l i c y b u t , a c c o r d i n g t o F r i e s e n 1 4 i t was t h e work o f Donald C r e i g h t o n i n t h e 1940s and 1950s who d e s c r i b e d t h e 1879 t a r i f f as a c r u c i a l element i n N a t i o n a l P o l i c y because i t was so c l o s e l y f i x e d t o t h e c o n s t r u c t i o n of a t r a n s c o n t i n e n t a l r a i l w a y . Today, t h e r e i s no agreement among h i s t o r i a n s t h a t MacDonald had a grand d e s i g n t o i n t e g r a t e t h e economy of Canada t h r o u g h h i s N a t i o n a l P o l i c y . John D a l e s has argued t h a t t h e 1879 t a r i f f p roduced economic growth t h a t was t o o f a s t , t oo l a r g e and u n a c c e p t a b l y i n e f f i c i e n t . Fowke has sug g e s t e d t h a t t h e t a r i f f d i s c r i m i n a t e d a g a i n s t t h e p r a i r i e r e g i o n and t h e wage l a b o u r e r . I n r e c e n t t i m e s A l b e r t a economist Dr. Ken N o r r i e has argued t h a t t h e t a r i f f s d i d not i n h i b i t t h e i n d u s t r i a l i z a t i o n o f t h e p r a i r i e s . 1 5 - 87 -The t a r i f f i t s e l f d i d not d i s c r i m i n a t e a g a i n s t the r e g i o n s o u t s i d e o f To r o n t o and M o n t r e a l i n t e n t i o n a l l y but i t i s t r u e t h a t t h e s e two c i t i e s b e n e f i t t e d more from t h e t a r i f f s t r u c t u r e t h a n d i d c i t i e s i n w e s t e r n Canada. The areas o u t s i d e t h e major p o p u l a t i o n c e n t r e s c o u l d not s u p p o r t i n d u s t r y a t t h e same s c a l e as t h a t i n e x i s t e n c e i n T o r o n t o . I t i s a l s o t r u e t h a t some o f t h e T o r o n t o and M o n t r e a l i n d u s t r i a l i z a t i o n was a r t i f i c i a l but t h i s was at the expense o f t h e U n i t e d S t a t e s . There i s no f e d e r a l t a r i f f a t t h e O n t a r i o - M a n i t o b a b o r d e r ! I n o t h e r words, i n d u s t r y i n w e s t e r n Canada r e c e i v e s t h e same " b e n e f i t " from t h e t a r i f f as does i n d u s t r y i n O n t a r i o . I r o n i c a l l y t o d a y t h e p r o v i n c e s t h e m s e l v e s have c o n s t r u c t e d n o n - t a r i f f b a r r i e r s between each o t h e r w h i c h a f f e c t t h e m o b i l i t y of c a p i t a l and l a b o u r i n Canada. Not a l l s t u d e n t s of Canadian h i s t o r y s u p p o r t t h e p o s i t i o n of t h e t a r i f f as t h e c e n t r e p i e c e of N a t i o n a l P o l i c y . R o b e r t Chodos b e l i e v e s t h e d a t e of c o m p l e t i o n of th e C a n a d i a n P a c i f i c R a i l w a y (1885): . . . i s a more a p p r o p r i a t e p o i n t from w h i c h t o d a t e our e x i s t e n c e as a c o u n t r y t h a n 1867. 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 t h r e e B r i t i s h c o l o n i e s got 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 Canada as a n a t i o n made l i t t l e sense w i t h o u t t h e g r e a t n o r t h west and Canada's h o l d o ver t h e n o r t h west was e x t r e m e l y tenuous w i t h o u t a r a i l w a y . - 88 -There would be a c o u n t r y and what k i n d of c o u n t r y i t would 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 I n s u p p o r t of Chodos, E. J . P r a t t w r o t e , " . . . l i k e a g a v e l - t h e d r i v i n g o f t h e l a s t s p i k e - c l o s e d o f f d e b a t e . " 1 7 Chodos makes an c o m p e l l i n g argument when he w r i t e s t h a t i f an a r t i f i c i a l e a s t - w e s t c o n n e c t i o n had not been b u i l t , t h e n a t u r a l n o r t h - s o u t h c o n n e c t i o n s would have p r e v a i l e d . He f u r t h e r argues t h a t w i t h o u t t h e CPR t h e p r a i r i e s would have been drawn i n t o t h e o r b i t of t h e American mid-western s t a t e s (Map on Page 189). Chodos admits t h a t a d e l a y of t e n y e a r s o f t h e b u i l d i n g of t h e CPR may have been p o s s i b l e w i t h o u t damage t o Canadian n a t i o n h o o d . The myth of t h e CPR was born and, as o u t l i n e d on Page 101 t h e e x p e c t a t i o n s of r a i l w a y development would p l a y havoc w i t h 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 f o r t h e next hundred y e a r s . I t would a l s o s i g n a l t h e s t a r t o f an a c r i m o n i o u s p e r i o d o f c o n f l i c t between t h e f e d e r a l government and i n i t i a l l y t h e seven and s u b s e q u e n t l y t h e t e n p r o v i n c i a l governments 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 . 3.1.2 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 F e d e r a l and p r o v i n c i a l powers c o n t a i n e d i n t h e - 89 -C o n s t i t u t i o n have a l r e a d y been d i s c u s s e d as has t h e purpose o f t h e o r i g i n a l C o n s t i t u t i o n , (1867) w h i c h gave broad powers t o t h e f e d e r a l government w i t h t h e i n t e n t i o n , i t a p p e a r s , o f g r a n t i n g e x t e n s i v e c o n t r o l o f t h e economy t o t h e c e n t r a l government. However, as a l r e a d y p o i n t e d o u t , t h e r e has been a t r a n s f o r m a t i o n of t h i s s h a r i n g of power towards t h e p r o v i n c e s . T h i s s e c t i o n a n a l y z e s how t r a n s p o r t a t i o n 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 by t h e C o n s t i t u t i o n and w i l l a s s e s s how t h e s e powers have e v o l v e d t o t h e p r e s e n t . Figure 2: Federal and Provincial Powers l i s t s t h e k i n d s o f powers p r o v i d e d t o b o t h t h e f e d e r a l government ( S e c t i o n 91) and t h e p r o v i n c i a l governments ( S e c t i o n s 92, 93) . I t i s b o t h i n t e r e s t i n g and s i g n i f i c a n t t o p o i n t out t h a t t h e Constitution Act, (1867) does n o t , " . . . e x p r e s s l y c o n f e r j u r i s d i c t i o n o v er t h e g e n e r a l h e adings of t r a n s p o r t a t i o n o r communications on e i t h e r P a r l i a m e n t o r t h e p r o v i n c i a l L e g i s l a t u r e s " . 1 8 F e d e r a l j u r i s d i c t i o n i n t h e ar e a s o f t r a n s p o r t a t i o n i s p r i m a r i l y based on s u b s e c t i o n s 92(10) and 91(29) o f t h e Constitution Act, 1867 w h i c h a s s i g n j u r i s d i c t i o n t o P a r l i a m e n t over what have become known as " i n t e r p r o v i n c i a l u n d e r t a k i n g s " . As w e l l : - 90 -FEDERAL AND PROVINCIAL POWERS FEDERAL 91 . It shal l be lawfu l for the Queen, by and w i th the Advice and Consent of the Senate and House of Com-mons, to make Law,s for the Peace, Order, and good Government of Canada, in relat ion to all Mat ters not c o m i n g w i th in the Classes of Subjec ts by th is Act ass igned ex-clusively to the Legis latures of the P r o v i n c e s ; . . . [ ILLUSTRATIONS] 1. The Publ ic Debt and Property 2. The Regulat ion of Trade and Commerce 3. The rais ing of Money by any Mode or System of Taxat ion 5. The Postal Service 7. M i l i t i a , Mi l i tary and Naval Ser-vice, and Defence 10. Navigat ion and Shipp ing 12. Sea Coast and Inland Fish-er ies 14. Currency and Coinage 15. B a n k i n g . . .and the Issue of Paper Money 24. Ind ians and Lands reserved for Ind ians 25. Natura l iza t ion and Al iens 26. Marr iage and Divorce 27. The Cr iminal Law PROVINCIAL 92. . . . 1. The A m e n d m e n t . . .of the Con-s t i tu t ion . . .except as regards the Of f ice of Lieutenant-Governor 2. Direct Taxat ion w i th in the P r o v i n c e . . . 5. The Management and Sale of the Publ ic L a n d s . . . 8. Mun ic ipa l Ins t i tu t ions in the Province 9. Shop, Saloon, Tavern, Auc-t ioneer, and other l icences 10. Local Works and Under tak ing other than such as are of the fo l low ing Classes: a) Transpor ta t ion fac i l i t ies l ink ing two provinces b) Transpor ta t ion fac i l i t ies l ink ing Canada and other count r ies c) Faci l i t ies w h i c h the Parlia-ment of Canada declares to be for the wel fare of Canada or more than the s ing le province. 12. The Solemnizat ion of Mar-r iage. . . 13. Property and Civi l r i g h t s . . . 14. The Admin is t ra t ion of Jus-t ice . . . 16. General ly all Mat ters of a merely local or pr ivate . N a t u r e . . . 93. In and for each Province the legis-lature may exclusively make laws in re lat ion to Educat ion Source: Saywell, John et a l How We Are Governed i n t h e 1980's, 1982 - 9 1 -...the power c o n t a i n e d i n t h e preamble t o s e c t i o n 91 of t h a t A c t t o make laws f o r t h e 'peace, o r d e r and good government o f Canada' has a l s o p r o v i d e d a s o u r c e of f e d e r a l j u r i s d i c t i o n . I n a d d i t i o n , c e r t a i n s p e c i f i c modes of t r a n s p o r t a t i o n a re i d e n t i f i e d i n s u b s e c t i o n s 9 1 ( 9 ) , (10) and (13) of t h e A c t as b e i n g s u b j e c t t o e x c l u s i v e f e d e r a l j u r i s d i c t i o n . 1 9 P r o v i n c i a l j u r i s d i c t i o n o v er 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 s u b s e c t i o n s 9 2 ( 1 0 ) , (13) and (16) of 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 works 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 'matters of m e r e l y l o c a l or p r i v a t e n a t u r e w i t h i n t h e p r o v i n c e . ' 2 0 There have been many j u d i c i a l t e s t s of t h e wor d i n g i n t h e above q u o t a t i o n . D a l f e n and D u n b a r 2 1 i n t h e i r j u d i c i a l r e v i e w f o r t h e Macdonald Commission, d e f i n e d f e d e r a l j u r i s d i c t i o n o v er u n d e r t a k i n g s c o n n e c t i n g one p r o v i n c e w i t h a n o t h e r , o r e x t e n d i n g beyond t h e l i m i t s of a s i n g l e p r o v i n c e , as f o l l o w s : I f an u n d e r t a k i n g engages i n a s i g n i f i c a n t degree of c o n t i n u o u s and r e g u l a r i n t e r -p r o v i n c i a l a c t i v i t y , i t w i l l f a l l w i t h i n f e d e r a l j u r i s d i c t i o n . 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 nder-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 i n t e r p r o v i n c i a l u n d e r t a k i n g , t h e l o c a l u n d e r - t a k i n g w i l l a l s o f a l l s u b j e c t t o f e d e r a l j u r i s d i c t i o n . - 92 -A t t h i s s t a g e i t i s n e c e s s a r y t o c o n s i d e r j u r i s d i c t i o n o v e r t h e v a r i o u s modes of t r a n s p o r t such as s h i p p i n g , a e r o n a u t i c s , r a i l w a y s and motor v e h i c l e t r a n s p o r t a t i o n . Shipping M a r i n e t r a n s p o r t a t i o n r e g u l a t i o n i s e x e r c i s e d p u r s u a n t t o a number o f s p e c i f i c p i e c e s of l e g i s l a t i o n t h a t i n c l u d e s t h e Navigable Waters Protection Act, t h e National Harbours Board Act, t h e Canadian Shipping Act, t h e National Transportation Act, t h e Pilotage Act, t h e Shipping Conferences Exemption Act, t h e St. Lawrence Seaway Authority Act and t h e Department of Transport Act. T h i s l e g i s l a t i o n e n a b l e s t h e f e d e r a l government t o r e g u l a t e n a v i g a b l e waterways, t h e s h i p p i n g r a t e s , r e g i s t r a t i o n of v e s s e l s , p i l o t a g e and t h e use of h a r b o u r s . P r o v i n c i a l j u r i s d i c t i o n c o v e r s i n t r a - p r o v i n c i a l o r l o c a l s h i p p i n g . A e r o n a u t i c s The f e d e r a l j u r i s d i c t i o n over a e r o n a u t i c s i s based on, P a r l i a m e n t ' s power t o make laws f o r t h e 'peace, o r d e r and good government' o f Canada. A e r o n a u t i c s i s r e g u l a t e d p u r s u a n t t o t h e Aeronautics Act and t h e National Transportation Act. The f e d e r a l government has e s t a b l i s h e d e x c l u s i v e - 93 -j u r i s d i c t i o n i n a i r t r a n s p o r t a t i o n . I t s r e g u l a t i o n s a f f e c t a l l c a r r i e r s , l o c a l and i n t r a p r o v i n c i a l u n d e r t a k i n g s and a l l o t h e r a c t i v i t i e s c o n s i d e r e d i n t e g r a l and c o n s i s t e n t t o a e r o n a u t i c s i n Canada. T h i s e x t e n s i v e r e g u l a t o r y a u t h o r i t y i s e x e r t e d by a s i n g l e r e g u l a t o r y body, t h e A i r T r a n s p o r t Committee o f t h e Canadian T r a n s p o r t Commission (CTC) and a s i n g l e f e d e r a l Department of T r a n s p o r t . A i r p a ssenger t r a n s p o r t has been t h e s u b j e c t s i n c e i t s e a r l y days o f e x i s t e n c e t o t i g h t government r e g u l a t i o n o v e r t h e market f o r c e s of t h e i n d u s t r y . D e s p i t e t h i s r e s t r i c t i v e p r a c t i c e and d e s p i t e t h e phenomenal growth of t h e a i r i n d u s t r y s i n c e 1940, t h e r e has not been an e n d u r i n g t r e n d t o 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 . There have been d i f f e r e n c e s and t h e p r o v i n c i a l o w n e r s hip o f r e g i o n a l a i r l i n e s was one example but t h e magnitude o f c o n f l i c t p a l e s i n c o m p a r i s o n t o t h a t a s s o c i a t e d w i t h t h e r a i l w a y s and r a i l f r e i g h t r a t e s . R a i l w a y s Canada's two major r a i l w a y s , CN R a i l and CP R a i l w h i c h h a n d l e 90 per c e n t of r a i l f r e i g h t , have b o t h been d e c l a r e d , "...works o r u n d e r t a k i n g s f o r t h e g e n e r a l advantage of Canada", and hence f a l l s u b j e c t t o f e d e r a l j u r i s d i c t i o n . 2 2 P r i o r t o 1988 t h e y were r e g u l a t e d by the R a i l T r a n s p o r t Committee of t h e Canadian T r a n s p o r t Commission p u r s u a n t t o t h e p r o v i s i o n s of t h e National Transportation Act, t h e Railway Act, t h e Maritimes Freight Rates Act and t h e Western Grain Transportation Act. L o c a l o r i n t r a p r o v i n c i a l r a i l w a y s such as BC R a i l a r e p r o v i n c i a l l y r e g u l a t e d . P r i o r t o 1967, t r a n s p o r t a t i o n law and r e g u l a t i o n i n Canada had become o s s i f i e d 2 3 as f r e i g h t r a t e p o l i c i e s were l e f t - o v e r s from t h e 1920s when r a i l r o a d s e n j o y e d a ne a r -monopoly of o v e r l a n d f r e i g h t s h ipments. However i n 1959 the MacPherson Commission r e c o g n i z e d t h a t t h e r a i l w a y s f a c e d s e v e r e c o m p e t i t i o n from o t h e r modes and as a r e s u l t , f o l l o w i n g passage of t h e National Transportation Act, (1967) t h e r a i l w a y s were a b l e t o change t h e i r r a t e s and p r a c t i c e s as r a p i d l y as market c o n d i t i o n s demanded. Two e x c e p t i o n s were made. One a f f e c t e d g r a i n r a t e s w h i c h remained f r o z e n a t l e v e l s f i x e d i n 1898 and 1899 and r a t e s a f f e c t i n g c o mmodities moving under t h e Maritime Freight Rates Act. 3.1.3 R a i l w a y Development To a p p r e c i a t e why r a i l w a y f r e i g h t r a t e s were such a - 95 -h i g h p r o f i l e i s s u e v i s a v i s a i r t r a n s p o r t r e l a t e d i s s u e s and t o p r o v i d e an h i s t o r i c a l p e r s p e c t i v e on t h e Crow Rate i s s u e , t h i s s e c t i o n p r o v i d e s an o v e r v i e w of railway-development i n Canada w i t h p a r t i c u l a r r e f e r e n c e t o t h e p r a i r i e p r o v i n c e s . There have been many books w r i t t e n on t h e h i s t o r y of r a i l w a y b u i l d i n g i n C a n a d a . 2 4 The themes a r e always t h e same. 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 t r a v e l have d e v e l o p e d i n Canadians a "romance w i t h t h e r a i l w a y s " . I t i s not s u r p r i s i n g t h a t one o f t h e more r e c e n t books was e n t i t l e d The National Dream. I n 1985, t h e M i n i s t e r of T r a n s p o r t t a l k e d about r e t u r n i n g t o t h a t romance by r e s t o r i n g un-economic r a i l p assenger s e r v i c e s . I n 1896 c o n s t r u c t i o n of th e Canadian N o r t h e r n R a i l w a y s began and t h e romance of i t s 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 by 0. S. S k e l t o n : " I n 1896 a r a i l w a y , a hundred m i l e s l o n g , b e g i n n i n g and endin g nowhere, o p e r a t e d by t h i r t e e n men and a boy! I n 1914, a g r e a t t r a n s c o n t i n e n t a l system p r a c t i c a l l y c o m pleted o v e r t e n thousand m i l e s ( 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 T h i s romance i s even c a r r i e d out i n song as performed by p o p u l a r C a n a d i a n f o l k s i n g e r Gordon L i g h t f o o t who, - 96 -" . . . s i n g s of t h e r a i l w a y b e i n g c o n s t r u c t e d so t h a t o t h e r s c o u l d b u i l d t h e mines, m i l l s and f a c t o r i e s f o r t h e good use o f a l l . " 2 6 L i k e so many f e a t u r e s o f Canadian t r a n s p o r t a t i o n -myth t r i u m p h s over r e a l i t y . T h i s i s c e r t a i n l y t h e case of r a i l r o a d b u i l d i n g i n Canada. The h i s t o r y of r a i l r o a d c o n s t r u c t i o n i n Canada i s c o n s i s t e n t l y d i v i d e d i n t o t h r e e p e r i o d s : t h e f i r s t b e f o r e 1900; t h e second from 1900 t o 1917; and th e t h i r d from 1923 t o 1931. T a b l e 2: R a i l w a v C o n s t r u c t i o n ( M i l e s o f T r a c k ) M a n i t o b a Saskatchewan A l b e r t a T o t a l 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 S o u r c e : State of The Industry Report Canada Grains Council. 1974 - 97 -P r i o r t o 1900 t h e c o n s t r u c t i o n and e x t e n s i o n of r a i l w a y s i n t o w e s t e r n Canada was encouraged by f e d e r a l l a n d g r a n t s . F o r example, Canadian P a c i f i c R a i l w a y was g r a n t e d 25 m i l l i o n a c r e s of l a n d i n r e t u r n f o r b u i l d i n g and m a i n t a i n i n g a 3,000 m i l e " t r a n s - c o n t i n e n t a l " r a i l w a y between M o n t r e a l and Vancouver. R a i l w a y s and f r e e l a n d were no use t o anybody w i t h o u t a purpose. T h e r e f o r e , a n o t h e r component of t h e s o - c a l l e d N a t i o n a l P o l i c y was i n t r o d u c e d . A c o m b i n a t i o n of a r a p i d s u r v e y system (which a l i e n a t e d t h e M e t i s ) and t h e i n t r o d u c t i o n of a f r e e homestead p o l i c y f a c i l i t a t e d t h e r a p i d s e t t l e m e n t of t h e p r a i r i e s . The p a r t i c i p a t i n g r a i l w a y s ( p r i m a r i l y t h e CPR) were p e r m i t t e d t o choose from odd-numbered s e c t i o n s i n r a i l w a y " b e l t s " o r " b l o c k s " d e s i g n a t e d as, " f a i r l y f i t f o r s e t t l e m e n t . " 2 7 I n Saskatchewan r a i l w a y l a n d g r a n t s t o t a l l e d a p p r o x i m a t e l y 15 m i l l i o n a c r e s almost 50 per c e n t of t h e Can a d i a n t o t a l , s i n c e r a i l w a y companies p r e f e r r e d t o choose f e r t i l e l a n d i n t h i s p r o v i n c e f o r m i l e a g e c o n s t r u c t e d i n rugged are a s e l s e w h e r e . 2 8 There were no immediate b e n e f i t s t o t h i s e x p a n s i o n a r y p o l i c y as t h e w o r l d was under t h e i n f l u e n c e of a g r e a t d e p r e s s i o n . The p e r i o d between 1900 and t h e 1914-18 World War was a p e r i o d o f u n u s u a l p r o s p e r i t y . I t was t h e p e r i o d of t h e f i r s t wheat boom i n Canada and a p e r i o d of i n t e n s e r a i l w a y - 98 -r b u i l d i n g and r i v a l r y . I n t h e f i f t e e n y e a r p e r i o d from 1900 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 , i n c r e a s i n g from 17,657 t o 34,882 m i l e s of l i n e . 2 9 As i n d i c a t e d i n Table 2: Railway Construction a p p r o x i m a t e l y 40 per c e n t of t h e t o t a l was l o c a t e d i n t h e p r a i r i e s . I t was a l s o d u r i n g t h i s t i m e p e r i o d t h a t two more " t r a n s - c o n t i n e n t a l " 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 of t h e main e a s t - w e s t r a i l w a y network t o p r o v i d e c o m p e t i t i o n w i t h t h e CPR. There was s t r o n g p r e s s u r e from t h e newly formed p r o v i n c e s o f A l b e r t a and Saskatchewan f o r new r a i l r o a d s t o o f f e r lower r a t e s t o move g r a i n . There i s no e v i d e n c e t h a t t h e r e was s u f f i c i e n t t r a f f i c t o w a r r a n t a second y e t a l o n e a t h i r d e a s t - w e s t system. By 1915, w i t h 35,000 m i l e s o f o p e r a t i o n a l r a i l w a y t r a c k , Canada had more t r a c k a g e per c a p i t a t h a n any o t h e r c o u n t r y i n t h e w o r l d . 3 0 The Grand Trunk P a c i f i c , w h i c h c o n s i s t e d of a system of 2,902 m i l e s between M o n t r e a l and P r i n c e R u p e r t , was a l s o $200 m i l l i o n d o l l a r s i n de b t . The Canadian N o r t h e r n , w h i c h c o n s i s t e d o f a system of 9,300 m i l e s and, n o t -w i t h s t a n d i n g t h e p r a i s e of S k e l t o n , was $427 m i l l i o n d o l l a r s i n debt i n 1 9 1 6 . 3 1 - 99 -The c o m b i n a t i o n of wheat boom, r a i l w a y c o n s t r u c t i o n and homestead p o l i c y r e s u l t e d i n t h e number of farms i n c r e a s i n g i n Saskatchewan a l o n e from 13,500 i n 1901 t o 100,000 i n 1916. The p o p u l a t i o n i n c r e a s e d d u r i n g t h i s same t i m e p e r i o d from 100,000 t o 6 5 0 , 0 0 0 . 3 2 I t was a l s o d u r i n g t h i s p e r i o d t h a t t h e f i r s t major c o n f l i c t d e v e l o p e d between t h e f e d e r a l and p r a i r i e p r o v i n c i a l governments. A c l a u s e i n t h e Agreement of 1881, between t h e f e d e r a l government and t h e CPR, was t h a t f o l l o w i n g c o m p l e t i o n of the CPR m a i n l i n e t h r o u g h t h e p r a i r i e s (1884-85) t h e r e would be no c o n s t r u c t i o n o f any b r a n c h l i n e s by any o t h e r r a i l w a y between t h e CPR m a i n l i n e and t h e U n i t e d S t a t e s b o r d e r f o r a t w e n t y - y e a r p e r i o d . The government of Ma n i t o b a t o o k t h e p o s i t i o n t h a t t h e CPR had a monopoly on the p r a i r i e s and e s t a b l i s h e d f r e i g h t r a t e s a t t o o h i g h a l e v e l . M a n i t o b a made s e v e r a l a t t e m p t s t o i s s u e C h a r t e r s t o A m e r i c a n r a i l r o a d s t o e s t a b l i s h c o m p e t i t i o n t o t h e CPR but MacDonald u t i l i z e d h i s d i s - a l l o w a n c e power i n t h e C o n s t i t u t i o n t o o v e r t u r n t h e C h a r t e r s . M a n i t o b a e v e n t u a l l y was s u c c e s s f u l i n o b t a i n i n g a l e a s e on a s m a l l . r a i l w a y ( N o r t h e r n P a c i f i c ) and i t e n t e r e d i n t o an agreement w i t h C a n a d i a n N o r t h e r n . M a n i t o b a g u a r a n t e e d t h e bonds o f Ca n a d i a n N o r t h e r n t o c o n s t r u c t a l i n e from P o r t A r t h u r t o Winnipeg and, i n r e t u r n , C anadian N o r t h e r n e s t a b l i s h e d g r a i n r a t e s a p p r o x i m a t e l y .04^ a b u s h e l below t h e Crow - 100 -R a t e s . Canadian P a c i f i c i m m e d i a t e l y lowered i t s g r a i n r a t e s , t o meet t h e c o m p e t i t i o n i n Man i t o b a and lowered i t s r a t e s by .02^ i n Saskatchewan and A l b e r t a where i t f a c e d l e s s c o m p e t i t i o n . The r a i l w a y p o l i c y o f M a n i t o b a was s u c c e s s f u l . 3 3 The t h i r d p e r i o d between 1923 and 1931 was marked once a g a i n by keen r i v a l r y . T h i s was a i d e d somewhat i n th e f o r m a t i o n of a more f o r m i d a b l e opponent t o t h e CPR th r o u g h t h e n a t i o n a l i z a t i o n of t h e Grand Trunk P a c i f i c and th e Canadian N o r t h e r n i n t o t h e Canadian N a t i o n a l R a i l w a y (CNR). G r a i n was c o n s i d e r e d a l u c r a t i v e t r a f f i c , y i e l d s were h i g h and over a b i l l i o n b u s h e l s were produced i n 1928. T h i s l a r g e c r o p was not s u r p a s s e d a g a i n u n t i l t h e 1970s. As i n d i c a t e d i n Table 2, over 2,000 m i l e s o f b r a n c h l i n e (2/3 o f t h e n a t i o n ' s t o t a l ) were b u i l t i n Saskatchewan. P r o d u c e r s d e l i v e r e d g r a i n t o t h e c o u n t r y e l e v a t o r d u r i n g t h i s t i m e p e r i o d by h o r s e and wagon. The r a i l w a y s b e l i e v e d t h a t h a u l s i n ex c e s s o f t e n m i l e s were beyond t h e r e a c h of g r a i n p r o d u c e r s t h u s r a i l w a y p o l i c y was t o b u i l d up t o t h e t e n - m i l e l i m i t . Figure 3: Branchline Rivalry p r o v i d e s a c l a s s i c example o f how a g g r e s s i v e t h i s r i v a l r y became. - 101 -FIGURE 3: B r a n c h l i n e R i v a l r y (1930) CPR CP R a i l c o n s t r u c t e d t h e W i s h a r t S u b d i v i s i o n because i t b e l i e v e d t h i s would head o f f an attempt by CNR t o c o n s t r u c t a s u b d i v i s i o n between t h e two e x i s t i n g l i n e s . R a i l w a y r i v a l r y was becoming i r r a t i o n a l and c o s t l y . R e p o r t o f t h e R o y a l Commission on R a i l w a y s 1931-1932 I n 1931 t h e t i m e was r i p e f o r an o v e r a l l e x a m i n a t i o n o f r a i l w a y p o l i c y i n Canada. The m y t h o l o g y o f MacDonald's " N a t i o n a l P o l i c y " has a l r e a d y been d i s c u s s e d . I t was argued t h a t i n a c t u a l f a c t t h e programs and p o l i c i e s w h i c h - 102 -have h i s t o r i c a l l y been a t t r i b u t e d t o N a t i o n a l P o l i c y were a c t u a l l y ad hoc, p a r o c h i a l and c o s t l y . T h i s was p a r t i c u l a r l y t r u e f o r r a i l w a y p o l i c y . A c c o r d i n g t o M i c h a e l B l i s s , "Ottawa's s e v e r a l n a t i o n a l development p o l i c i e s were not p a r t of a c o h e r e n t p l a n o r r e c i p e f o r n a t i o n - b u i l d i n g . " 3 4 A d m i t t e d l y , t h e o v e r a l l Canadian economy was i n d e c l i n e i n t h e t h i r t i e s and a l t h o u g h g r a i n volumes remained c o n s t a n t , p r i c e s d e c l i n e d s i g n i f i c a n t l y and o t h e r r a i l w a y t r a f f i c had f a l l e n r a p i d l y . R a i l w a y b u i l d i n g t o o k i t s t o l l and b o t h t h e CPR and CNR were s i g n i f i c a n t l y i n de b t . As such, b o t h R a i l w a y P r e s i d e n t s a d v o c a t e d t h e e s t a b l i s h m e n t of a R o y a l Commission on " T r a n s p o r t a t i o n " . Such a Commission was i n f a c t e s t a b l i s h e d under t h e R i g h t Honourable Lyman D u f f , J u s t i c e of t h e O n t a r i o Supreme C o u r t t o make recommendations t o r e s t o r e t h e f i n a n c i a l h e a l t h of t h e r a i l w a y s who were a f f e c t e d by o v e r - e x p a n s i o n of l i n e s , and t r u c k c o m p e t i t i o n and t h e d e p r e s s i o n . The Duff Commission spent n i n e months h o l d i n g p u b l i c h e a r i n g s a c r o s s Canada and d e l i v e r e d a f i n a l r e p o r t t o t h e new C o n s e r v a t i v e Government headed by R i g h t Honourable R. B. B e n n e t t . V i r t u a l l y a l l o f t h e Duff Commission recommendations were a c c e p t e d by t h e government and embodied i n t h e Canadian National - Canadian Pacific Railway Act (1933), w h i c h r e s u l t e d i n more r a i l w a y r e g u l a t i o n and t i g h t e r f i s c a l c o n t r o l s . The Du f f Commission was - 103 -p a r t i c u l a r l y h a r s h on t h e i n t e n s e r i v a l r y i n b r a n c h l i n e c o n s t r u c t i o n p o l i c y and l e v i e d s t r o n g c r i t i c i s m a g a i n s t not o n l y t h e r a i l w a y s but a l s o f e d e r a l and p r o v i n c i a l g o v e r n m e n t s . 3 5 I n response t o t h e c l a i m o f each r a i l w a y t h a t p a r t of i t s b r a n c h l i n e program might have been d e f e r r e d but f o r t h e f e a r t h a t i t s r i v a l would i n v a d e t e r r i t o r y s t r a t e g i c t o i t s l i n e s (see Figure 3: Branchline Rivalry), t h e Commission c r i t i c i z e d t h e r a i l w a y s f o r t h e i r u n r e s t r a i n e d p o l i c y i n b r a n c h l i n e c o n s t r u c t i o n . I t c o n c l u d e d : " . . . 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 r i v a l r y between t h e two systems i n new t e r r i t o r y , p a r t i c u l a r l y i n t h e p r o v i n c e s of Saskatchewan and A l b e r t a . The c o n s t r u c t i o n program o f one company was responded t o by an e q u a l o r g r e a t e r program of c o n s t r u c t i o n by t h e o t h e r . The development of t h i s t e r r i t o r y d i d not meet e x p e c t a t i o n s and t h e r a i l w a y s now f i n d 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 burden of c a p i t a l c h a r g e . " 3 6 The D u f f Commission, w h i l e c r i t i c a l o f t h e a g g r e s s i v e and u n c o n t r o l l e d c o m p e t i t i o n between t h e two r a i l w a y s , d i d not p r o v i d e any recommendations t o d e a l w i t h t h e o v e r l y l a r g e b r a n c h l i n e network nor t h e impending c o m p e t i t i o n t h e r a i l w a y s would soon f a c e from highway t r a n s p o r t a t i o n . A r e v i e w o f Table 2: Railway Construction shows t h a t t h e r e has been a s l i g h t i n c r e a s e i n t h e s i z e o f t h e r a i l network - 104 -i n t h e p r a i r i e s s i n c e t h e r e p o r t . I t was not o n l y o v e r - b u i l t i n t h e 1930s g a t h e r i n g system. D u f f Commission s u b m i t t e d i t s the r a i l w a y system t h a t was but a l s o t h e e n t i r e g r a i n T a b l e 3: 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  ( P r a i r i e s ) (1930 t o 1985) 1930 1960 1970 1980 1985 R a i l System M i l e a g e 18,192 19,238 19,238 18,200 17,000 No. of E l e v a t o r s 5,700 5,300 4,970 3,133 1,952 No.of D e l i v e r y P t s . 2,500 N/A 1,835 1,394 1,148 M i l e s of Road 20,000 160,000 200,000 200,000 200,000 S o u r c e : Department of Transport, "The Crow Book", Ottawa, 1982. The major c o n c l u s i o n t h a t can be drawn from Table 3: Grain Handling and Transportation Trends i s t h a t between 1930 and 1970 t h e system of r a i l w a y s and g r a i n e l e v a t o r s remained v i r t u a l l y untouched by e v e n t s t a k i n g p l a c e around i t . I n Saskatchewan, as i n A l b e r t a and M a n i t o b a , t h e r u r a l component ( f a r m and non-farm r e s i d e n t s i n c e n t r e s o f l e s s t h a n 1,000 p e r s o n s ) o f t h e p o p u l a t i o n s h i f t e d from 85 per c e n t i n 1901 t o l e s s t h a n 20 per c e n t i n 1970. P r i o r t o - 105 -1949, l e s s t h a n one per ce n t of Saskatchewan p r o d u c e r s were s u p p l i e d w i t h e l e c t r i c i t y . Today v i r t u a l l y e v e r y farm i n t h e p r o v i n c e has ac c e s s t o e l e c t r i c i t y . Table 3: Changes in Agricultural Society l i s t t h e v a r i o u s t r e n d s t h a t e v o l v e d i n t h e p r a i r i e s 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 S o c i e t y 1. D e s p i t e t h e pr e s e n c e of r a i l s e r v i c e , most g r a i n d e l i v e r y p o i n t s e x p e r i e n c e d s i g n i f i c a n t d e c r e a s e s i n p o p u l a t i o n . 2. D u r i n g two decades (1960 t o 1980) c o n s o l i d a t i o n of a l l p u b l i c s e r v i c e s ( p a r t i c u l a r l y s c h o o l 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 p r o v i n c i a l 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 were over 1,000 implement d e a l e r s on t h e p r a i r i e s . Today t h a t number i s l e s s t h a n 400. 4. I n 1930 t h e r e were a p p r o x i m a t e l y 300,000 p r o d u c e r s on th e p r a i r i e s . Today t h e number has d e c r e a s e d t o 140,000. 5. C o n s o l i d a t i o n o f g r a i n on m a i n l i n e and sec o n d a r y l i n e s has r e s u l t e d i n 1/5 o f t h e g r a i n d e l i v e r y p o i n t s h a n d l i n g 1/2 of a l l t h e g r a i n . Moreover, 30 per c e n t o f t h e p r o d u c e r s account f o r 80 per c e n t of t o t a l p r o d u c t i o n . They own 60 per c e n t o f t h e farm m a c h i n e r y . S o u r c e : Prairie Rail Action Committee Report (1979) - 106 -The s i g n i f i c a n c e o f T a b l e s 3 and 4 i s t h a t b o t h f e d e r a l and p r a i r i e p r o v i n c i a l p o l i t i c i a n s e i t h e r f a i l e d t o a p p r e c i a t e t h e s e t r e n d s o r chose t o i g n o r e them i n t h e v a r i o u s t r a n s p o r t a t i o n debates w h i c h t o o k p l a c e s i n c e 1930. How can one e x p l a i n t h e f a c t t h a t t h e p r a i r i e b r a n c h l i n e network remained f r o z e n between 1930 when h o r s e h a u l a g e t o e l e v a t o r s was s t i l l i n use and when t h e Duff Commission s t a t e d t h e network was t o o l a r g e , and 1970 when v a s t l y improved roads and l a r g e r t r u c k s s i g n i f i c a n t l y i n c r e a s e d t h e a b i l i t y o f p r o d u c e r s t o move g r a i n . There are s e v e r a l e x p l a n a t i o n s f o r t h i s and a l l o f them are r e l e v a n t t o t h i s t h e s i s . F i r s t , t h e r e was no 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 i n e x i s t e n c e p r i o r t o t h e p a s s i n g of t h e National Transportation Act i n 1967. P r i o r t o t h a t y e a r , 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 was r a i l w a y p o l i c y and t h e emphasis was on r e t e n t i o n o f r a i l s e r v i c e ( r e g a r d l e s s o f need) a t t h e lo w e s t p o s s i b l e r a t e s . A t t h e f o r e f r o n t o f t h i s debate were governments o f t h e p r a i r i e p r o v i n c e s . The t a r g e t was th e r a i l w a y s and t h e f e d e r a l government w h i c h was h e l d r e s p o n s i b l e f o r r a i l w a y p o l i c y . Second, t h e p e r c e p t i o n e x i s t e d t h a t r a i l w a y s were t h e l i f e l i n e s t o t h e many s m a l l communities on t h e p r a i r i e s , - 107 -w h i c h would " d i e " i f t h e r a i l w a y s were removed. I n 1976, t h e Commission on 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 3 7 , headed by former Supreme C o u r t J u s t i c e Emmett H a l l from Saskatchewan, t a b l e d a r e p o r t i n P a r l i a m e n t w h i c h , a l t h o u g h c o n s i d e r a b l y weak i n t e c h n i c a l d e t a i l s , d i d i n c l u d e a s e n s i t i v e s e c t i o n on t h e p r a i r i e g r a i n p r o d u c e r . That Commission r e c o g n i z e d t h e d i f f e r e n c e between t h e s i n c e r i t y of t h o s e who appeared i n s u p p o r t of r e t a i n i n g b r a n c h l i n e s and t h e r e a l i t y of t o d a y . Amongst a number of t h i n g s i t s a i d : " I t appears t h a t t h e r e may be a tendency t o e q u a t e ' 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 of 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 . " ( V o l . 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 of t h e p e o p l e w h i c h g i v e s t h e community v i a b i l i t y , not t h e r a i l w a y s , not t h e e l e v a t o r s . " ( V o l . I , p. 7 9 ) . The Commission was u n a b l e t o l o c a t e 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 community w h i c h was a l r e a d y d e c l i n i n g would be saved by r e t e n t i o n o f t h e r a i l w a y . " ( V o l . I , p. 8 3 ) . The t h i r d e x p l a n a t i o n i s " . . . t h e t r a d i t i o n a l p r a i r i e d i s t r u s t o f t h e r a i l w a y s . " 3 8 T h i s t r a d i t i o n o f a n t i p a t h y between p r o d u c e r s and t h e r a i l w a y s ( p a r t i c u l a r l y t h e CPR) has i t s r o o t s embedded d e e p l y i n h i s t o r y . I n t h e e a r l y - 108 -development p e r i o d t h e r a i l w a y s f r e q u e n t l y a n t a g o n i z e d the farm s e c t o r by t h e i r u n b r i d l e d use of t h e i r m o n o p o l i s t i c power as s o l e p r o v i d e r s of t r a n s p o r t a t i o n s e r v i c e f o r outbound p r o d u c t and inbound s u p p l i e s o f a l l d e s c r i p t i o n s . C o n s e q u e n t l y c o n f l i c t s over f r e i g h t r a t e s and q u a l i t y of s e r v i c e drew u n f a v o u r a b l e a t t e n t i o n t o t h e r a i l w a y s ' p erformance as l a n d l o r d s t o thousands o f g r a i n p r o d u c e r s . ^ Land g r a n t s * came t o be seen as p r e f e r e n t i a l arrangements between e a s t e r n based p o l i t i c i a n s and e a s t e r n based e n t r e p r e n e u r s . R a r e l y was c o n s i d e r a t i o n g i v e n t o the i n i t i a l h i g h r i s k element i n w e s t e r n r a i l w a y s ' c o n s t r u c t i o n o r t o t h e o b l i g a t i o n s f u l f i l l e d by t h e r a i l w a y s under the e a r l y agreements. The f o r t u i t o u s but u n f o r e s e e n u n i v e r s a l w e a l t h d e r i v e d from l a n d g r a n t s by. t h e r a i l w a y s came t o be re g a r d e d as l e g a l i z e d r o b b e r y . 3 9 F o u r t h , t h e p r a i r i e b r a n c h l i n e system became e n t a n g l e d w i t h s t a t u t o r y g r a i n r a t e s . The R a i l w a y s ' r e a c t i o n was t o reduce i n v e s t m e n t s i n t h e p r a i r i e b r a n c h l i n e system w h i l e l o b b y i n g Ottawa f o r an end t o l e g i s l a t e d f r e i g h t r a t e s . 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 Commission i n 1961 (wh i c h i s d i s c u s s e d i n d e t a i l i n t h e s e c t i o n on t h e National Transportation Act (1967) recommended inter alia a s u b s i d y f o r uneconomic b r a n c h l i n e s and t h e abandonment of u n n e c e s s a r y l i n e s . The government responded w i t h i t s f i r s t o f many ad hoc d e c i s i o n s r e l a t e d t o p r a i r i e b r a n c h l i n e s . I n 1965 t h e f e d e r a l government i s s u e d an O r d e r - i n - C o u n c i l * p r o t e c t i n g a l l but 1839 m i l e s of b r a n c h l i n e from abandonment f o r t e n y e a r s . D u r i n g t h i s p e r i o d of ti m e t h e b r a n c h l i n e network c o n t i n u e d t o remain v i r t u a l l y unchanged. The f e d e r a l government a p p o i n t e d J u s t i c e Emmett H a l l t o head up a Commission on 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 t o come t o g r i p s w i t h t h e fundamental problems c o n f r o n t i n g t h e i n d u s t r y , i n c l u d i n g a s t r a t e g y t o d e a l w i t h t h e b r a n c h l i n e network. However p r i o r t o a s s i g n i n g t h e network t o J u s t i c e H a l l , t h e f e d e r a l government on t h e recommendation of T r a n s p o r t M i n i s t e r O t t o Lang, p r o t e c t e d 12,413 m i l e s of t h e network from abandonment u n t i l a t t h e l e a s t t h e y e a r 2000. I n a d d i t i o n , 525 m i l e s were a s s i g n e d 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 -T r a n s p o r t Commission (CTC) f o r abandonment h e a r i n g s . The H a l l Commission was asked t o make recommendations on t h e r e m a i n i n g 6,283 m i l e s , about 30 per c e n t of t h e network. T a b l e 5: S t a t u s o f R a i l w a y M i l e a g e (1975-1979) 1975 - B a s i c Network 12,414.0 C a b i n e t Order - no p u b l i c h e a r i n g s 1977 - H a l l Commission - 1,812.6 R o y a l Commission p u b l i c h e a r i n g s 1978 - P r a i r i e R a i l A c t i o n Committee 1979 - N e i l R e p o r t - 1,000.6 658.9 15,890.1 T e c h n i c a l Committee headed by P r o f e s s o r F r e d Anderson, U n i v e r s i t y of Re g i n a - no p u b l i c h e a r i n g s T e c h n i c a l Committee headed by 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 The H a l l Commission recommended t h a t 1812.6 m i l e s be added t o t h e b a s i c network f o r p r o t e c t i o n from abandonment ( t h e government a c c e p t e d t h i s recommendation as i t d i d t h e one t o a s s i g n 2,165 m i l e s t o t h e CTC f o r abandonment h e a r i n g s ) . - I l l -The H a l l Commission was un d e c i d e d on 2,344 m i l e s and i t recommended t h a t t h e s e be p r o t e c t e d f o r 12 y e a r s . Mr. Lang r e j e c t e d t h i s p a r t i c u l a r recommendation on t h e a d v i c e of t h e e l e v a t o r companies who s a i d t h e y c o u l d not i n v e s t i n t h e i r f a c i l i t i e s on l i n e s l e f t i n a s t a g e of l i m b o . I n 1977 t h e 2,334 m i l e s were a s s i g n e d t o t h e P r a i r i e R a i l A c t i o n Committee (PRAC)*, headed by t h e U n i v e r s i t y of Regi n a Economics P r o f e s s o r F r e d Anderson. PRAC recommended a f u r t h e r 1,000.6 m i l e s t o be added t o t h e b a s i c network and abandonment of t h e r e m a i n i n g m i l e a g e . Once a g a i n t h e f e d e r a l government a c c e p t e d t h e s e recommendations and t h e 1,000 m i l e s were p r o t e c t e d from abandonment and t h e o t h e r m i l e a g e was a s s i g n e d t o t h e CTC f o r abandonment h e a r i n g s . The 1979 e l e c t i o n w h i c h brought t h e P r o g r e s s i v e C o n s e r v a t i v e s i n t o power had a d i r e c t impact on t h e b r a n c h -l i n e network. The PC's, i n response t o p r o d u c e r s on l i n e s under CTC r e v i e w , a p p o i n t e d Moose Jaw M.P. Doug N e i l t o once a g a i n r e v i e w t h e m i l e a g e (about 1500 m i l e s ) t h a t PRAC had recommended f o r abandonment. N e i l recommended about 659 m i l e s be added t o t h e b a s i c network and t h e r e m a i n i n g m i l e a g e be a s s i g n e d t o t h e CTC f o r f u r t h e r r e v i e w . "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 -be There are a drawn from th e number of i n t e r e s t i n g c o n c l u s i o n s l e n g t h y p r o c e s s d i s c u s s e d above. t h a t can The t o t a l number of m i l e s of r a i l l i n e abandoned t o d a t e (1984-85) are a p p r o x i m a t e l y 2,400 m i l e s or 12 per c e n t o f t h e m i l e a g e i n e x i s t e n c e i n 1930. Of t h e f i r s t 2,000 m i l e s of b r a n c h l i n e approved by t h e CTC f o r abandonment, about 1/2 of t h e m i l e a g e was a c t u a l l y abandoned p r e v i o u s l y by g r a i n p r o d u c e r s . Of t h e r e m a i n i n g m i l e a g e of 16,700 m i l e s , a p p r o x i m a t e l y 83 per c e n t are p r o t e c t e d u n t i l a t l e a s t t h e y e a r 2000. No b r a n c h l i n e was abandoned w i t h o u t t h e b e n e f i t of a CTC H e a r i n g a l l o w i n g anyone t o come f o r w a r d who may have f e l t he or she would be u n d u l y a f f e c t e d by b r a n c h l i n e abandonment. I n some ca s e s b r a n c h l i n e s were the s u b j e c t of r e v i e w by t h e H a l l Commission, PRAC, Doug N e i l (M.P.) and t h e CTC b e f o r e an abandonment o r d e r was i s s u e d . The i s s u e o f b r a n c h l i n e abandonment i s one o f t h o s e i s s u e s w h i c h was e x p l o i t e d by p r o v i n c i a l governments t o c r e a t e t h e i m p r e s s i o n t h a t " r e g i o n a l " and community i n t e r e s t s were not b e i n g met. The p r o v i n c i a l p o s i t i o n s were r e p o r t e d t o t h e n a t i o n by b o t h t h e n a t i o n a l and p r o v i n c i a l / l o c a l media and t h i s " c l o u d o f doom" had an a d v e r s e a f f e c t on t h e Crow Rate d e b a t e . - 113 -I f t h e f e d e r a l government i s t o be c r i t i c i z e d , i t s h o u l d be f o r d e v e l o p i n g a p o l i c y w h i c h g u a r a n t e e d an e x t e n s i v e b a s i c network t o t h e y e a r 2000. The b r a n c h l i n e network f u l f i l s o n l y one b a s i c r o l e : i t c o l l e c t s t h e g r a i n and f u n n e l s i t on t o t h e m a i n l i n e s f o r d e l i v e r y t o p o r t . As a l r e a d y i n d i c a t e d , a p p r o x i m a t e l y 1/5 o f a l l t h e g r a i n d e l i v e r y p o i n t s are r e s p o n s i b l e f o r 50 per c e n t of t h e g r a i n volume. Many of t h e s e d e l i v e r y p o i n t s are l o c a t e d on m a i n l i n e s . To f u r t h e r compound t h i s problem, t h e f e d e r a l government began a major b r a n c h l i n e r e p a i r program i n 1977 w h i c h i s e x p e c t e d t o c o s t o ver $1 b i l l i o n when c o m p l e t e d . As of 1985-86, $730 m i l l i o n had a l r e a d y been s p e n t . 4 1 W i t h over 16,000 m i l e s of r a i l l i n e s t i l l i n c l u d e d i n t h e b a s i c network and almost 1/3 o f i t e l i g i b l e f o r 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 b e l i e v e t h a t t h e r e d u c t i o n i n t h e system was not d r a s t i c enough t o a l l o w f o r improved e f f i c i e n c y . One of t h e s e o b s e r v e r s i s F r e d Anderson who: . . . c l a i m s p o l i t i c a l p r e s s u r e s made t h e e n t i r e r a t i o n a l i z a t i o n p r o c e s s l e s s t h a n adequate. The b a s i c network i s i t s e l f an i r r a t i o n a l c o l l e c t i o n o f l i n e s d e r i v e d from a s e r i e s o f p o l i t i c a l l y e x p e d i e n t d e c i s i o n s . E v e n t s 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 b a s i c n e t w o r k . 4 2 - 114 -I f one examines Table 5: Status of Railway Mileage (1975-1979) i t i s q u i t e e v i d e n t t h a t t h e l a r g e s t segment of m i l e a g e p r o t e c t e d from abandonment i s t h e i n i t i a l b l o c k of 12,444 m i l e s . What was t h e b a s i s f o r t h e s u p p o r t o f t h e s e l i n e s ? There i s no p u b l i c r e p o r t t o r e f e r t o and one f e d e r a l department o f t r a n s p o r t o f f i c i a l conceded t h a t , " . . . t h e r e was no s o p h i s t i c a t e d s t u d y done." He goes on t o suggest 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 one made on th e b a s i s o f a meeting between r a i l w a y and f e d e r a l t r a n s p o r t o f f i c i a l s . 4 3 The b r a n c h l i n e d e b a c l e i s f a r from o v e r . The E x e c u t i v e D i r e c t o r of PRAC was quoted, back i n 1978, t h a t a p o s s i b i l i t y e x i s t e d t h a t g r a i n p r o d u c e r s / h a n d l i n g companies would abandon a f u l l y r e h a b i l i t a t e d b r a n c h l i n e by 1 9 8 5 . 4 4 I n 1932, t h e Du f f Commission warned about t h e imminent c o m p e t i t i o n from highway t r a n s p o r t a t i o n , w h i c h was a p p a r e n t l y i g n o r e d . Thus one of t h e r e a l c o s t s o f Canada's s t y l e o f f e d e r a l i s m was b e g i n n i n g t o t a k e shape and t h i s w i l l be examined i n t h e f o l l o w i n g s e c t i o n on highway t r a n s p o r t a t i o n . 3.1.4 Highway T r a n s p o r t a t i o n The 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 u n d e r t a k i n g s - 115 -i s s p l i t depending on whether t h e u n d e r t a k i n g i s of a l o c a l , i n t e r - p r o v i n c i a l o r i n t e r n a t i o n a l n a t u r e . I t i s n e c e s s a r y t o d i s t i n g u i s h between j u r i s d i c t i o n o v er roads and j u r i s d i c t i o n over t h e motor c a r r i e r i n d u s t r y . Roads a r e not mentioned i n e i t h e r S e c t i o n s 91 or 92 of t h e Constitution Act 1867, t h e judges r e f e r r e d t o t h e terms " c o n n e c t i n g " and " u n d e r t a k i n g " t o j u s t i f y t h e i r d e c i s i o n s . I n th e words of L o r d P o r t e r * : "The p r o v i n c e has in d e e d a u t h o r i t y over i t s own r o a d s , but 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 does not e n t i t l e i t t o i n t e r f e r e w i t h c o n n e c t i n g under-t a k i n g s . I t must be remembered t h a t i t i s t h e u n d e r t a k i n g ( t h e a c t u a l movement o f goods and pa s s e n g e r s ) - not t h e r o a d s , w h i c h comes w i t h i n t h e D o m i n i o n . . . " 4 5 The f e d e r a l response t o t h i s r u l i n g and a number of c o u r t c a s e s was t o d e l e g a t e t h e r e g u l a t i o n of e x t r a ( i n t e r n a t i o n a l and i n t e r - ) p r o v i n c i a l u n d e r t a k i n g s t o p r o v i n c i a l boards e s t a b l i s h e d p u r s u a n t t o p r o v i n c i a l motor v e h i c l e t r a n s p o r t a t i o n l e g i s l a t i o n by e n a c t i n g t h e Motor Vehicle Transport Act i n 1 9 5 4 4 6 . The m a t t e r o f f e d e r a l j u r i s d i c t i o n a r o s e a g a i n i n 1967 w i t h t h e passage of t h e National Transportation Act. P a r t I I I of t h a t A c t would *Lord Porter was a member of the British Privy Council, which acted as Canada's Supreme Court until 19491 r e s t o r e f e d e r a l j u r i s d i c t i o n over e x t r a - p r o v i n c i a l t r u c k i n g but t h a t s e c t i o n was not i n v o k e d . P a r t i a l l y t h i s can be e x p l a i n e d by t h e f e d e r a l government not b e i n g i n t e r e s t e d and p a r t i a l l y because the p r o v i n c e s have r e s i s t e d such a n o t i o n . The r e s u l t has been t o a l l o c a t e t o t h e f e d e r a l government complete j u r i s d i c t i o n o v e r r a i l w a y s w i t h t h e s u p p o r t of a s i n g l e r e g u l a t o r y agency. I n t r u c k i n g and b u s e s , j u r i s d i c t i o n i s s h a r e d by t e n p r o v i n c i a l governments w i t h no o v e r a l l n a t i o n a l s t a n d a r d s . A former Deputy M i n i s t e r of T r a n s p o r t , John B a l d w i n , argues t h a t : "...under t e n 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 erage has been slow and fragmented and t h a t t h e motor coach s e r v i c e has a l e s s c o m plete and l e s s e q u i t a b l e arrangement t h a n can be found i n a i r and r a i l p assenger 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 r e g u l a t i o n s and a f e d e r a l r e g u l a t o r y agency, not o n l y does Canada as a whole l o s e t h e advantage of a n a t i o n a l motor c a r r i e r i n d u s t r y but v a r i o u s r e g i o n s , such as A t l a n t i c Canada, s u f f e r i n p a r t i c u l a r . " 4 7 As B a l d w i n f u r t h e r p o i n t s o u t : " . . . r e g i o n a l t r a n s p o r t a t i o n companies t e n d t o c h a r g e h i g h e r r a t e s i n r e s ponse t o h i g h e r r e g i o n a l c o s t s . 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 n a t i o n a l s e r v i c e and f e d e r a l r e g u l a t i o n s . 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 e x i s t w i t h r e s p e c t t o a i r t r a n s p o r t a t i o n , t h e y a r e l a c k i n g i n r e g a r d s t o t h e motor c a r r i e r i n d u s t r y . " 4 8 - 117 -As i n t h e case of e d u c a t i o n and h e a l t h s e r v i c e s , p r o v i n c i a l j u r i s d i c t i o n i n t r a n s p o r t a t i o n i s c e n t r e d on t h e major growth s e c t o r s . I n t h e case of t r a n s p o r t a t i o n t h i s means roads and c o n c o m i t a n t l y t h e motor c a r r i e r i n d u s t r y . , The growth o f t h e t r u c k i n g i n d u s t r y c o r r e l a t e s w i t h t h e d e c l i n e i n t h e r a i l w a y i n d u s t r y b e g i n n i n g i n t h e l a t e 1930s. T r u c k r e g i s t r a t i o n d o u b l e d from 220,000 i n 1938 t o 488,000 i n 1948 and d o u b l e d a g a i n t o o v e r one m i l l i o n v e h i c l e s i n 1 9 5 8 . 4 9 I n 1982, some 60,000 f i r m s o p e r a t e d 500,000 commercial t r u c k s , t r a c t o r s and t r a i l e r s , employed over 350,000 p e o p l e and p a i d $15 b i l l i o n i n o p e r a t i n g e x p e n s e s . 5 0 On t h e b a s i s o f revenue, t h e r a i l w a y s ' s h a r e o f f r e i g h t movements has f a l l e n from 55 per c e n t i n 1966 t o 37 per c e n t i n 1983; f o r - h i r e t r u c k i n g s ' s h a r e of f r e i g h t movement (c o m m e r c i a l but not p r i v a t e ) has r i s e n t o 44 per c e n t from 30 per c e n t . I n terms of d o m e s t i c i n t e r - c i t y passenger t r a f f i c , 93.3 per c e n t o f a l l such t r i p s a re made by auto o r bus over t h e p r o v i n c i a l l y r e g u l a t e d road system. The s i g n i f i c a n c e of t h i s t r e n d i s t h a t t h e t e n p r o v i n c i a l governments p l a y a s i g n i f i c a n t r o l e i n t h e t r a n s p o r t a t i o n system w h i c h was not r e c o g n i z e d i n t h e National Transportation Act (1967). - 118 -Road Building As a l r e a d y i n d i c a t e d , t h e e x t e n t and magnitude o f t h e road b u i l d i n g p o l i c y of t h e t e n p r o v i n c i a l governments has not r e c e i v e d as h i g h a p r o f i l e as have t h e deb a t e s over r a i l w a y f r e i g h t r a t e s i n Canada: However, as Howard D a r l i n g i d e n t i f i e d , by 1950: ...the onward surge of c o m p e t i t i o n from highway c a r r i e r s was not 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 ver w h i c h so 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 , but was s e l e c t i v e l y p e n e t r a t i n g r a i l w a y t r a f f i c , s t r i p p i n g t h e g e n e r a l t r a f f i c from b r a n c h l i n e s and s h o r t h a u l s o f a l l k i n d s . 5 1 I n 1959, t h e D i e f e n b a k e r Government e s t a b l i s h e d t h e MacPherson Commission on T r a n s p o r t a t i o n , p r i m a r i l y t o r e s o l v e t h e c o n t i n u i n g p r e s s u r e o f t h e r a i l w a y s * f o r a d d i t i o n a l " h o r i z o n t a l " r a t e i n c r e a s e s . * The former S e c r e t a r y / R e s e a r c h D i r e c t o r o f t h a t Commission, P r o f e s s o r F r e d Anderson o f t h e U n i v e r s i t y of R e g i n a , s u b s e q u e n t l y c r i t i c i z e d t h e narrowness 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 -r e f e r e n c e , "...as b e i n g s p e c i f i c i n t h e i r a t t e n t i o n t o r a i l w a y s , r e a f f i r m i n g as l a t e as 1959 t h e p e r s i s t e n t myth t h a t t r a n s p o r t a t i o n i s r a i l w a y t r a n s p o r t a t i o n i n C a n a d a . " 5 2 N o t w i t h s t a n d i n g t h a t p e r c e p t i o n i n 1959, a highway system was i n i t i a t e d i n Saskatchewan as e a r l y as 1922; t h e proposed network b e i n g p l a n n e d t o comply w i t h t h e Canada Highway Act, (1919). T h i s A c t p r o v i d e d a per c a p i t a g r a n t t o each p r o v i n c e . A t t h e s t a r t of t h e program t h e r e were o n l y t e n m i l e s of g r a v e l r o a d s ; t h e r e m a i n i n g roads were d i r t . 5 3 By 1940 t h e r e were over 4,000 m i l e s of g r a v e l road but o n l y 100 m i l e s of paved highways. For t h i s r e a s o n t r u c k i n g was not c o n s i d e r e d a c o m p e t i t o r t o r a i l f o r d i s t a n c e s beyond 50 t o 100 m i l e s . F o l l o w i n g t h e 1939-1945 World War t h e road system i n Saskatchewan grew s i g n i f i c a n t l y . Between 1946 and 1966 t h e l e n g t h of s u r f a c e d roads i n c r e a s e d from under 10,000 t o 57,000 m i l e s and a l l t h e p r o v i n c i a l c e n t r e s i n Saskatchewan were l i n k e d by h i g h q u a l i t y r o a d s . 5 4 I n Canada t o t a l s p e n d i n g on s t r e e t s and highways from 1960 n e a r l y d o u b l e d t o $1.8 b i l l i o n a y e a r i n 1970. I n 1950 t h e r e were 25,000 m i l e s o f paved road w h i c h by 1970 had i n c r e a s e d t o 75,000 m i l e s . 5 5 Paved roads mean f a s t t r u c k i n g s e r v i c e s and, as s u c h , t r u c k i n g was now c o n s i d e r e d c o m p e t i t i v e t o - 120 -r a i l f o r d i s t a n c e s i n t h e 400 m i l e range. To s e r v i c e t h e g r a i n growing area of Saskatchewan, s e t t l e m e n t s and farms were e s t a b l i s h e d i n a w i d e l y d i s p e r s e d manner. As a r e s u l t Saskatchewan h i s t o r i c a l l y has had more v i l l a g e s t h a n t h e p r o v i n c e of Quebec. I n a d d i t i o n , Saskatchewan i s s e r v e d by more r a i l w a y and highway m i l e a g e , on a per c a p i t a b a s i s , t h a n any o t h e r p r o v i n c e . Moreover, t h e t h r e e p r a i r i e p r o v i n c e s c o n t a i n over 50 per c e n t of t h e t o t a l road (highway and r u r a l ) m i l e a g e i n Canada. Saskatchewan a l o n e c o n s i s t s o f a p p r o x i m a t e l y 125,000 m i l e s of r o a d , over 25 per c e n t of t h e n a t i o n ' s t o t a l . As a r e s u l t 90 per c e n t o f t h e p o p u l a t i o n of Saskatchewan i s w i t h i n one hour's d r i v i n g d i s t a n c e o f a t l e a s t one of t h e t e n major com m e r c i a l c e n t r e s i n t h e p r o v i n c e . Thus t h e second t r a n s p o r t a t i o n system on t h e p r a i r i e s , t h e road system c o m p l e t e l y owned and o p e r a t e d by t h e p r o v i n c i a l governments, e v e n t u a l l y succeeded i n r e l e g a t i n g t h e r a i l system t o l o n g - h a u l f r e i g h t s h i p m e n t s . As t h e H a l l Commission documented i n i t s 1977 r e p o r t , 5 6 f o l l o w i n g n e a r l y two 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 p r a i r i e s : - 121 -i ) " I n c r e a s e d c o s t o f l a b o u r f o r c e d f a r m e r s t o improve p r o d u c t i o n t e c h n o l o g y t h r o u g h c a p i t a l . T h i s r e s u l t e d 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 farm p o p u l a t i o n and i n t h e number of community c e n t r e s of s e r v i c e . " (Page 7 6 ) . i i ) "Tendency t o equate 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 of 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 t o d a y . " (Page 7 6 ) . i i i ) "Even b u l k farm i m p o r t s such as f e r t i l i z e r , f u e l , c h e m i c a l s and equipment are i n c r e a s i n g l y h a u l e d from 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 ) . i v ) "The r a i l w a y s have ceased t o have any g r e a t e f f e c t on t h e s o c i a l a s p e c t s of l i f e i n t h e s m a l l e r communities i n w e s t e r n Canada." (Page 7 8 ) . v) " R u r a l e l e c t r i f i c a t i o n has no doubt had t h e most s i g n i f i c a n t p o s i t i v e s o c i a l impact on r u r a l l i f e ...due t o t h e i n a b i l i t y ( s i c ) t o keep bread f r e s h and v e g e t a b l e s and f r u i t s f o r l o n g e r p e r i o d s , t h e s e commodities were purc h a s e d i n g r e a t e r q u a n t i t y , f u r t h e r from home l e a d i n g t o t h e c l o s i n g o f l o c a l b a k e r i e s and s t o r e s . . . " . (Page 7 9 ) . v i ) "The Commission 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 of a community w h i c h was a l r e a d y d e c l i n i n g would be s e r v e d by t h e r e t e n t i o n of t h e r a i l w a y . " (Page 8 3 ) . v i i ) " V a s t l y improved roads s i n c e t h e e a r l y 1950s ...have e n a b l e d p e o p l e t o t r a v e l f u r t h e r f o r goods and s e r v i c e s . " (Page 7 9 ) . v i i i ) Towns b e i n g bypassed by modern highways, th e development of 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 of o t h e r i t e m s 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 of 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 i d e n t i t i e s and s o c i a l p a t t e r n s . These changes have o c c u r r e d and w i l l c o n t i n u e t o o c c u r , w i t h o r w i t h o u t t h e r a i l w a y . " (Pages 79-80). i x ) "The evolvement of 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 of s e r v i c e s has t a k e n p l a c e o n l y because s e v e r a l s m a l l e r c e n t r e s have d e c r e a s e d i n s i z e or d i s a p p e a r e d a l t o g e t h e r . T h i s t o o k p l a c e , not as a p a r t o f a p l a n n e d development but as a r e s u l t o f many p e o p l e making i n d i v i d u a l d e c i s i o n s on where t h e y w i s h e d t o shop, do b u s i n e s s and s o c i a l i z e . " (Page 80 ) . - 122 -The s i g n i f i c a n c e of t h e s e f i n d i n g s i s r e l e v a n t t o t h e Crow Rate debate s i n c e opponents t o changes i n t h e Crow Rate w i l l argue t h a t t h e e x i s t e n c e of a f i x e d r a i l r a t e f o r g r a i n keeps p r o d u c e r c o s t s down and, as a r e s u l t , system change would be g r a d u a l . However, a l l of t h e s e developments w i t h i n t h e t h r e e p r a i r i e p r o v i n c e s o c c u r r e d w i t h t h e Crow Rate i n p l a c e between 1899 and 1983 (84 y e a r s ) and f i x e d a t l e v e l s e s t a b l i s h e d i n 1898 and 1899. 3.1.5 T r a n s p o r t P o l i c y Development The framework f o r 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 h i s t o r i c a l l y has c e n t r e d on t h e theme of c o n c e r n w i t h e f f i c i e n c y and c o s t e f f e c t i v e n e s s v e r s u s e q u i t y and emphasis on t h e r a i l mode. R a i l w a y development became the t r a d i t i o n a l l e v e r of t h e f e d e r a l government t o a c h i e v e i t s " n a t i o n - b u i l d i n g " o b j e c t i v e s . P r i o r t o t h e 1914-18 World War t h e major a c t i v i t i e s i n t r a n s p o r t a t i o n were r a i l not m a r ine r e l a t e d . These e v e n t s were: 1. O v e r b u i l d i n g and economic chaos i n r a i l w a y o p e r a t i o n s . 2. The e s t a b l i s h m e n t of t h e f i r s t r e g u l a t o r y agency -Board o f R a i l w a y Commissioners. 3. The f i r s t major r a t e problems l e a d i n g t o e q u a l i z a t i o n of r a t e s w i t h i n t h e west. 4. To t h e f i r s t p r i c e c e i l i n g - t h e Crow's Nest Pass Rates on G r a i n . 5 7 - 123 -As a l r e a d y p r e s e n t e d i n t h i s t h e s i s , t h e development of t h e road system and t h e commercial a i r t r a n s p o r t system tended t o be i g n o r e d as t h e r a i l mode, or more s p e c i f i c a l l y , r a i l f r e i g h t r a t e s , c o n t i n u e d i t s dominant r o l e up t o and beyond t h e passage of t h e National Transportation Act i n 1967. T h i s dominance of t h e r a i l mode i s r e m a r k a b l e . I f one l i s t s t h e major m i l e s t o n e s w h i c h a f f e c t e d 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 i e s a f t e r t h e 1939-45 World War, r a i l c o n c e r n s a re paramount. Some of t h e s e major t r a n s p o r t p o l i c y i s s u e s a re d i s c u s s e d on t h e f o l l o w i n g pages. 1951 - Turgeon R o v a l Commission on T r a n s p o r t a t i o n At t h e ti m e o f t h e Turgeon Commission's appointment, i n December 1948, t h e vi e w s t i l l p r e v a i l e d t h a t t h e r a i l w a y s were t h e major t r a n s p o r t mode o f economic i m p o r t a n c e i n Canada. W h i l e i t s r e p o r t d e a l t m a i n l y w i t h t h e r a i l w a y s , t h e Commission d i d r e c o g n i z e t h e growing s i g n i f i c a n c e o f r o a d - r a i l c o m p e t i t i o n and recommended t h a t a l l t r a n s p o r t modes s u b j e c t t o f e d e r a l j u r i s d i c t i o n be brought under t h e c o n t r o l of a s i n g l e r e g u l a t o r y b oard i n th e i n t e r e s t s o f b e t t e r i n t e r m o d a l c o o r d i n a t i o n . The themes o f m u l t i m o d a l i t y , f e d e r a l - p r o v i n c i a l j u r i s d i c t i o n a l - 124 -problems and t h e n o t i o n of a need f o r u n i f o r m r e g u l a t i o n of a l l modes began emerging over t h i r t y y e a r s ago. 1954 - Motor V e h i c l e T r a n s p o r t A c t The f i r s t o f f i c i a l i n d i c a t i o n by t h e f e d e r a l government t h a t i t had a c o n s t i t u t i o n a l r i g h t t o r e g u l a t e e x t r a - p r o v i n c i a l t r u c k i n g o c c u r r e d i n 1937 w i t h t h e i n t r o d u c t i o n of a new T r a n s p o r t a t i o n B i l l i n t h e Senate. P a r t IV o f t h e B i l l r e l a t e d t o highway t r a n s p o r t . The B i l l was d e f e a t e d l a r g e l y because of s t r o n g o p p o s i t i o n from t h e p r o v i n c e s and t h e t r u c k e r s . T h i s same c o m b i n a t i o n a l s o opposed t h e u n s u c c e s s f u l B i l l C-14 i n t r o d u c e d i n t h e Commons d u r i n g 1940 w h i c h , t h r o u g h an amendment t o t h e 1938 Transport Act, was i n t e n d e d , among o t h e r t h i n g s , t o empower t h e the n Board o f T r a n s p o r t Commissioners t o l i c e n s e i n t e r n a t i o n a l movements by comm e r c i a l road c a r r i e r s . I n 1954, a p r o t r a c t e d l e g a l a c t i o n Attorney-General of Ontario vs Winner* ended w i t h t h e d e c i s i o n t h a t t h e f e d e r a l *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 o n l y had j u r i s d i c t i o n o v e r e x t r a -p r o v i n c i a l motor t r a n s p o r t under S e c t i o n 92(10) (a) o f t h e B r i t i s h N o r t h America A c t but a l s o o ver t h e i n t r a -p r o v i n c i a l o p e r a t i o n s of any company engaged i n e x t r a -p r o v i n c i a l t r a n s p o r t on a c o n t i n u o u s and r e g u l a r b a s i s s i n c e t r a n s p o r t u n d e r t a k i n g s were " i n d i v i s i b l e " . The f e d e r a l government was s u r p r i s e d by t h e outcome of t h e Winner case and had no s t a f f o r r e g u l a t i o n s i n p l a c e t o assume r e s p o n s i b i l i t y f o r e x t r a - p r o v i n c i a l f o r - h i r e t r u c k i n g . R a t h e r t h a n s e t up a r e g u l a t o r y regime, t h e r e g u l a t i o n of e x t r a - p r o v i n c i a l motor v e h i c l e u n d e r t a k i n g s was l e f t w i t h t h e p r o v i n c i a l r e g u l a t o r y a g e n c i e s by a d e l e g a t i o n of t h e f e d e r a l power t h r o u g h t h e 1954 Motor Vehicle Transport Act. T h i s A c t p r o v i d e s f o r t h e i s s u a n c e by a p r o v i n c i a l b o a r d , at t h e i r d i s c r e t i o n , of a l i c e n c e t o a p e r s o n on l i k e terms and c o n d i t i o n s as i f t h e e x t r a - p r o v i n c i a l u n d e r t a k i n g i n v o l v e d was a l o c a l u n d e r t a k i n g . The Motor Vehicle Transport Act vi as i n t e n d e d as a stop-gap measure. However, i t remains i n f o r c e t o d a y d e s p i t e p e r i o d i c a t t e m p t s t o change t h e modus operandi s e t up 30 y e a r s ago. - 126 -1956 - T r a n s p o r t a t i o n Study f o r t h e R o y a l Commission on  Canada's Economic P r o s p e c t s (Gordon Commission) The 1956 t r a n s p o r t a t i o n r e p o r t f o r t h e R o y a l Commission on Canada's Economic P r o s p e c t s n o t e d t h e i n c r e a s i n g i m p o r t a n c e of t h e motor c a r r i e r and a i r l i n e modes and t h e growth i n c o m p e t i t i o n w i t h i n t h e f r e i g h t t r a n s p o r t f i e l d . I n t h e passenger domain, t h e r e p o r t p o i n t e d out t h a t t h e r a i l w a y s had g i v e n ground t o t h e p r i v a t e c a r and bus and t h a t a i r t r a v e l was p e n e t r a t i n g t h e l o n g - h a u l market. These o b s e r v a t i o n s s i g n a l l e d t he r e c o g n i t i o n of two c o n t i n u i n g p o l i c y problems - t r u c k i n g / r a i l c o m p e t i t i o n and t h e a p p r o p r i a t e p l a c e of r a i l p a s senger 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 - MacPherson Commission on T r a n s p o r t a t i o n The most n o t e w o r t h y of a l l t h e i n q u i r i e s i n t o t r a n s p o r t a t i o n o r t o be more e x a c t , as t h i s t h e s i s has argued, i n t o r a i l t r a n s p o r t problems was t h e MacPherson Commission R e p o r t . There a re a number o f reasons f o r t h i s . F i r s t , t h e MacPherson Commission R e p o r t p r o v i d e d t h e b a s i s f o r t h e subsequent passage o f t h e National Transportation Act i n 1967. Second, t h e Commission pushed t h r o u g h i t s narrow r a i l o r i e n t e d terms of r e f e r e n c e t o - 127 -p r e s e n t t o P a r l i a m e n t f o r t h e f i r s t t i m e a t r u l y m u l t i -modal p e r s p e c t i v e ; and t h i r d , i t recommended removal of t h e r e g u l a t o r y r e s t r a i n t s imposed upon t h e r a i l mode i n o r d e r t h a t i t c o u l d compete w i t h o t h e r modes. I n t h e p r o c e s s t h e MacPherson Commission i s c r e d i t e d w i t h , " . . . b r i n g i n g t h e r a i l w a y s i n t o t h e t w e n t i e t h c e n t u r y . " W h i l e t h e Commission i t s e l f was headed up by a R egina l a w y e r , M.A. MacPherson, th e p e r s o n who r e c e i v e s t h e c r e d i t f o r t h e p h i l o s o p h y of t h e r e p o r t i s i t s S e c r e t a r y and R e s e a r c h D i r e c t o r , F r e d Anderson, c u r r e n t l y P r o f e s s o r E m e r i t u s of Economics at R i e l U n i v e r s i t y . P r o f e s s o r Anderson p r o v i d e s t h e f o l l o w i n g e x p l a n a t i o n of t h e r e l a t i o n s h i p of t r a n s p o r t a t i o n p o l i c y t o r e g i o n a l i z a t i o n w r i t t e n from th e p e r s p e c t i v e of h i s t e n u r e w i t h t h e Commission: " T h i s much was new i n t h e r e p o r t . Up t o t h a t t i m e t h e c o m p l a i n t s o f r e g i o n a l t r a n s p o r t i n e q u i t i e s seems a minor but n o i s y n u i s a n c e . H i s t o r i c a l l y t h e y have been a m e l i o r a t e d by s p e c i a l s t a t u t o r y p r o v i s i o n s f o r r e g i o n a l t r a n s p o r t - p r i c i n g t h r o u g h t h e M a r i t i m e F r e i g h t R a t e s A c t , t h e Crow's Nest Pass Agreement and "At and E a s t " r a t e s on g r a i n and t h e p r i n c i p l e of " e q u a l i z a t i o n " adopted a f t e r 1951. The t r a n s p o r t d i s e q u i l i b r i a e v i d e n t t h r o u g h t h e decade of t h e f i f t i e s seemed, i n 1959, amenable t o a n o t h e r p r e s c r i p t i o n of a d j u s t m e n t , s i m i l a r t o t h a t a t t e m p t e d by t h e Turgeon Commission recommendations of 1951. A t l e a s t t h e terms of r e f e r e n c e o f t h e MacPherson Commission appear t o bear t h i s o u t . 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 e v e n t s of t h a t decade t o s a t i s f y t h e clamour from t h e A t l a n t i c and p r a i r i e r e g i o n s seemed, i n t h e p e r s p e c t i v e from Ottawa, t o be - 128 -caused by r e g u l a t o r y i n a d e q u a c i e s a l o n e . There was no presentment t h a t i t was more t h a n t h a t ; t h a t t h e clamour was, i n f a c t , growing e v i d e n c e of much more fundamental f a i l u r e s o f n a t i o n a l 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 s t r u c t u r e o f Canada. N o t h i n g i n t h e terms o f r e f e r e n c e l e d , on t h e s u r f a c e , t o a c o n v i c t i o n t h a t t r a n s p o r t p o l i c y was j u s t one p a r t o f b r o a d e r 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 n a t i o n i n d i r e c t i o n s away from v i g o r o u s economic and s o c i a l i n t e g r a t i o n " . 5 8 The major c o n c l u s i o n s reached by t h e MacPherson Commission were as f o l l o w s : 1. The r e g u l a t i o n of t r a n s p o r t a t i o n i n Canada s h o u l d be m i n i m i z e d 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 t h e p r o t e c t i o n of t h e 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 bear 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 of r a i l w a y p l a n t and o p e r a t i o n s s h o u l d be a c t i v e l y encouraged by p u b l i c p o l i c y ; where, f o r n a t i o n a l p o l i c y r e a s o n s , 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 such as u n p r o f i t -a b l e passenger or b r a n c h l i n e s e r v i c e s , t h e 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 from p u b l i c funds t o c o v e r t h e i r d e f i c i t s on such s e r v i c e s . 3. No p a r t i c u l a r form of t r a n s p o r t s h o u l d be s i n g l e d out as an i n s t r u m e n t of n a t i o n a l p o l i c y i f any burden i s i n v o l v e d i n t h e performance of t h e f u n c t i o n u n l e s s s u f f i c i e n t compensation i s p r o v i d e d t o t h a t mode of t r a n s p o r t t o p r e v e n t d i s t o r t i o n s i n t h e c o m p e t i t i v e t r a n s p o r t a t i o n market. 4. A s s i s t a n c e t o t r a n s p o r t a t i o n , w h i c h i s d e s i g n e d t o p r o v i d e a s s i s t a n c e t o s h i p p e r s i n s p e c i f i c r e g i o n s , s h o u l d be r e c o g n i z e d f o r what i t i s and not 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 n o n d i s c r i m i n a t o r y b a s i s t o a l l . Source: MacPherson Commission Report, Vol. I, 1961 - 129 -T h i s i d e a t h a t t h e p r i n c i p a l c o n c e r n of 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 s h o u l d be w i t h ways of a c h i e v i n g an e f f i c i e n t t r a n s p o r t a t i o n system t o s e r v e t h e economy, was a s h a r p d e p a r t u r e from th e h i s t o r i c a l v i e w t h a t t h e t r a n s p o r t a t i o n system was p r i m a r i l y an i n s t r u m e n t f o r t h e p u r s u i t o f broad n a t i o n a l p o l i c y o b j e c t i v e s . By 1961 a g r e a t d e a l of Canada's major t r a n s p o r t a t i o n i n f r a s t r u c t u r e was a l r e a d y i n p l a c e . Thus MacPherson and h i s f e l l o w c o m m i s s i o n e r s s u g g e s t e d , at t h e a d v i c e of F r e d Anderson, t h a t t h e c o n c e p t of " c o m p e t i t i o n " h e n c e f o r t h ought t o g u i d e t h e o r g a n i z a t i o n , f i n a n c i n g and development of t r a n s p o r t a t i o n s e r v i c e s . The r o l e of government was seen as b e i n g l a r g e l y a p a s s i v e one of s e l e c t i v e p r o v i d e r and o p e r a t o r of i n f r a s t r u c t u r e and s e r v i c e s and t h e s o u r c e of c ompensation f o r 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 imposed as a p u b l i c d u t y . T h i s r o l e was c o n s i d e r e d t o r e q u i r e a minimum of r e g u l a t i o n . N a t i o n a l T r a n s p o r t a t i o n A c t (1967) S i x y e a r s l a t e r P a r l i a m e n t , a f t e r a fundamental r e a p p r a i s a l o f 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 and p r o l o n g e d d e b a t e , passed th e n a t i o n a l T r a n s p o r t A c t based, i n l a r g e p a r t , on recommendations by t h e MacPherson Commission o f 1961. - 130 -The g o a l s of t h e A c t are s e t out c l e a r l y i n S e c t i o n 3 t h e r e o f as f o l l o w s : I t i s hereby d e c l a r e d t h a t an economic, e f f i c i e n t and adequate t r a n s p o r t a t i o n system making t h e b e s t l o w e s t t o t a l c o s t i s e s s e n t i a l t o p r o t e c t t h e i n t e r e s t s of t h e u s e r s o f t r a n s p o r t a t i o n 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 growth o f Canada, and t h a t t h e s e o b j e c t i v e s a re most l i k e l y t o be a c h i e v e d when a l l modes of t r a n s p o r t a r e a b l e t o compete under c o n d i t i o n s e n s u r i n g t h a t h a v i n g due r e g a r d 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 r e q u i r e m e n t s : 1) r e g u l a t i o n of a l l modes of t r a n s p o r t w i l l not be o f such 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 of any mode of t r a n s p o r t t o compete f r e e l y w i t h any o t h e r modes of t r a n s p o r t ; 2) each mode of t r a n s p o r t , so f a r as p r a c t i c a b l e , b e a r s 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 of 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 of t r a n s p o r t a t p u b l i c expense; 3) each mode o f t r a n s p o r t , so f a r as p r a c t i c a b l e , r e c e i v e compensation f o r 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 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 imposed p u b l i c d u t y ; and 4) each mode of t r a n s p o r t , 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 Canada under t o l l s and c o n d i t i o n s t h a t do not c o n s t i t u t e : a) an u n f a i r advantage i n r e s p e c t t o any such t r a f f i c beyond t h a t d i s a d v a n t a g e i n h e r e n t i n t h e l o c a t i o n o r volume of t h e t r a f f i c , t h e s c a l e of o p e r a t i o n c o n n e c t e d t h e r e w i t h o r t h e t y p e o f t r a f f i c o r s e r v i c e i n v o l v e d , o r 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 commodities between p o i n t s i n Canada o r u n r e a s o n a b l e discouragement t o t h a t - 131 -development of p r i m a r y o r sec o n d a r y i n d u s t r i e s or t o e x p o r t t r a d e i n or from any r e g i o n o f Canada, o r t o t h e movement of commodities t h r o u g h Canadian p o r t s . The A c t made p r o v i s i o n f o r m i n i m a l and c o n s i s t e n t r e g u l a t i o n o f a l l modes t o a l l o w freedom o f c o m p e t i t i o n . I t i n t r o d u c e d t h e "user pay" concept t h r o u g h t h e p r o v i s i o n t h a t each mode bear a f a i r p r o p o r t i o n o f t h e c o s t s of 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 as an imposed p u b l i c d u t y . N e a r l y 20 y e a r s l a t e r , i t might be n o t e d , a c o n s i d e r a b l e gap remains between t h e p r o v i s i o n s of t h e A c t and r e a l i t y . W h i l e g e n e r a l l y f o l l o w i n g t h e recommendations and s p i r i t o f t h e MacPherson Commission, t h e National Transportation Act (1967) made a s i g n i f i c a n t d e p a r t u r e i n i t s p r o v i s i o n f o r t h e e s t a b l i s h m e n t of t h e Canadian T r a n s p o r t Commission (CTC), w h i c h combined a l l e x i s t i n g r e g u l a t o r y a g e n c i e s and, i n a d d i t i o n and c o n t r a r y t o t h e MacPherson R e p o r t , was g i v e n wide p o l i c y a d v i s o r y powers u n r e l a t e d t o i t s r e g u l a t o r y f u n c t i o n . 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 A t t h e t i m e of C o n f e d e r a t i o n , r a i l w a y r e l a t e d p r o j e c t s - 132 -came under t h e Department of P u b l i c Works. On c o m p l e t i o n of t h e I n t e r - C o l o n i a l R a i l w a y i n 1879, t h e Department of R a i l w a y s and C a n a l s t o o k over t h e s e d u t i e s . I n 1935 a Department of T r a n s p o r t was c r e a t e d w h i c h i n c l u d e d t h e former Department of R a i l w a y s and C a n a l s w h i c h , by t h i s t i m e , had e s t a b l i s h e d a Highways Branch and i t subsumed th e Department o f M a r i n e ' s t r a n s p o r t r e l a t e d r e s p o n s i b i l -i t i e s . The C i v i l A v i a t i o n Branch of t h e Department of N a t i o n a l Defense was a l s o added i n 1935. The r e s u l t was one of t h e l a r g e s t b u r e a u c r a t i c u n i t s i n t h e g o v e r n m e n t . 5 9 W h i l e r a i l f r e i g h t r a t e s c o n t i n u e d t o dominate the p u b l i c ' s p e r c e p t i o n of 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 , t h e department had v i r t u a l l y no c o n t r o l o v er r a i l w a y o p e r a t i o n s . However, t h e department d i d have s i g n i f i c a n t o p e r a t i o n a l a u t h o r i t y i n b o t h t h e a i r and marine modes. By 1968, t h e department had 11,300 o f f i c i a l s i n v o l v e d i n a i r s e r v i c e s and 5,900 i n marine s e r v i c e s . 6 0 I n co m p a r i s o n , t h e r e were l e s s t h a n a h a n d f u l o f o f f i c i a l s r e s p o n s i b l e f o r r a i l and highway m a t t e r s . As suc h , t h e Department o f T r a n s p o r t was a c t u a l l y an o p e r a t i o n a l department and 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 was non-e x i s t e n t o r ad hoc up t o t h e passage of t h e National Transportation Act i n 1967. T h i s was s i g n i f i c a n t s i n c e t h e G l a s s c o Commission on Government O r g a n i z a t i o n i n 1963 - 133 -recommended t h a t a s e p a r a t e A i r Department be c r e a t e d . The T r a n s p o r t Department r e s i s t e d t h i s recommendation on th e b a s i s t h a t t h e MacPherson Commission had emphasized, " . . . t h e need f o r d e v e l o p i n g t r a n s p o r t a t i o n p o l i c y t h a t embraces a l l modes o f t r a n s p o r t and r e l a t e d t r a n s p o r t a t i o n needs t o t h e o t h e r elements of economic g r o w t h . " 6 1 The pro b l e m was however t h a t t h e Department had no p o l i c y b r a n c h and, t h e r e f o r e , t o a l a r g e e x t e n t had no 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 . There was no one i n t h e Department t o a d v i s e t h e M i n i s t e r on n o n - o p e r a t i o n a l m a t t e r s . The main problem was t h a t w i t h o u t a p o l i c y b r a n c h , the Department d i d not have an o v e r a l l approach t o t r a n s p o r t -a t i o n p o l i c y . T h i s a c c o u n t s f o r t h e " r a i l w a y - o r i e n t e d " terms o f r e f e r e n c e w h i c h were p r o v i d e d ( p r i m a r i l y by PCO) to t h e MacPherson Commission i n 1959. I n a d d i t i o n , t h e c r e a t i o n o f t h e National Transportation Act i n 1967 a l s o a l l o c a t e d r e s p o n s i b i l i t y f o r r e s e a r c h and p o l i c y recommendations t o a newly c r e a t e d r e g u l a t o r y agency, t h e Canad i a n T r a n s p o r t a t i o n Commission. F o l l o w i n g t h e passage of t h e NTA, s e n i o r Department o f T r a n s p o r t (DOT) management c o n t i n u e d t o eschew a p o l i c y r e s e a r c h r o l e o r even a s t r o n g r o l e , c o n c e n t r a t i n g i n s t e a d on o p e r a t i n g m a t t e r s . The c l a i m was t h a t s e n i o r management i n t e r p r e t e d t h e r o l e of t h e Department w i t h i n t h e n a t i o n a l - 134 -t r a n s p o r t a t i o n framework t o o n a r r o w l y . The Department soon found i t s e l f out of s t e p w i t h p r i o r i t i e s of t h e Trudeau G o v e r n m e n t . 6 2 I n J a n u a r y 1969 a new deputy m i n i s t e r , Mr. G e r a l d S t o n e r , was a p p o i n t e d t o DOT and q u i c k l y i n t r o d u c e d o r g a n i z a t i o n changes such as a T r a n s p o r t a t i o n C o u n c i l as an i n s t r u m e n t o f p o l i c y c o o r d i n a t i o n and a Bureau of C o o r d i n a t i o n as a s e c r e t a r i a t f o r t h e d e p a r t m e n t a l management p r o c e s s . He s u b s e q u e n t l y a p p o i n t e d a Task F o r c e t o examine DOT'S o b j e c t i v e s . The Task F o r c e r e s u l t e d i n t h e i n t r o d u c t i o n i n 1970 of t h e m i n i s t r y c o n c e p t * and new department o b j e c t i v e s . A m i n i s t r y e x e c u t i v e was c r e a t e d w i t h c e n t r a l i z e d s u p p o r t f o r p o l i c y and p l a n n i n g ; e x t e n s i v e autonomy was g i v e n t o th e o p e r a t i n g a d m i n i s t r a t i o n s , i n c l u d i n g a newly c r e a t e d C a nadian S u r f a c e T r a n s p o r t A d m i n i s t r a t i o n and a p l a n n i n g u n i t was s e t up t o d e a l w i t h t r a n s p o r t a t i o n p o l i c y g e n e r a l l y , i n c l u d i n g t h e r o l e s o f t h e CTC and r e l e v a n t Crown C o r p o r a t i o n s . *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 f o r t h e f o l l o w i n g r e a s o n s : * 1) The M i n i s t r y concept was supposed t o emphasize p o l i c y - m a k i n g but t h e massive a i r and marine a d m i n i s t r a t i o n s 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 i n t e g r a t e m u l t i - m o d a l 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 th e 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 (1973-74) was under c o n s t a n t p r e s s u r e t o address t h e chaos i n t h e t r a n s p o r t a t i o n system w h i c h . a r o s e because t h e MacPherson Commission's recommendations (embodied i n the NTA) i n t h e area of s u b s i d y and r a t e i n t e r v e n t i o n s were not a d d r e s s e d . 4) Western Canada was p a r t i c u l a r l y c o n c erned w i t h what i t saw as a l a c k of u n d e r s t a n d i n g on t h e p a r t of 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 . T r a n s p o r t a t i o n Task F o r c e I n 1974 t h e M i n i s t e r of T r a n s p o r t , Mr. Marchand, d e s c r i b e d Canada's t r a n s p o r t a t i o n p o l i c y as a "mess". I n the Speech from t h e Throne on September 30 t h a t y e a r , t h e Government announced i t s i n t e n t i o n t o c a r r y out a comprehensive r e v i e w o f t r a n s p o r t a t i o n p o l i c y by a Department o f T r a n s p o r t Task F o r c e , under t h e d i r e c t i o n of J i m 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 t h e c h i e f aims of t h e Task F o r c e were the i n c l u s i o n of r e g i o n a l o b j e c t i v e s i n t r a n s p o r t a t i o n p o l i c y and d e a l i n g w i t h f r e i g h t r a t e c o n c e r n s . The Task F o r c e was i n s t r u m e n t a l i n t h e f r e i g h t r a t e a c c o r d o f t h e f e d e r a l and f o u r w e s t e r n t r a n s p o r t m i n i s t e r s , emanating out of t h e Western Economic O p p o r t u n i t i e s C o n f e r e n c e (see Page 155) . The seven y e a r s between t h e passage of t h e NTA and th e f o r m a t i o n of t h e Task F o r c e had seen a number of d r a m a t i c changes i n t h e s o c i a l and economic e n v i r o n m e n t , b o t h i n Canada and e l s e w h e r e . Demand f o r s c a r c e r e s o u r c e s was i n c r e a s i n g , r e s u l t i n g i n g r e a t e r a t t e n t i o n t o n o r t h e r n Canada as a s u p p l y s o u r c e w i t h consequent demands f o r new t r a n s p o r t i n f r a s t r u c t u r e . The w o r l d had e x p e r i e n c e d t h e f i r s t major m a n i f e s t a t i o n s of t h e changed energy scene i n l a t e 1973 l e a d i n g t o energy becoming a much b i g g e r f a c t o r i n subsequent t r a n s p o r t a t i o n p l a n n i n g and p o l i c y d e c i s i o n s . I n t h i s e n v i r o n m e n t , t h e Task F o r c e b e l i e v e d t h a t t h e v e r y r a p i d i n c r e a s e i n demand f o r b u l k c ommodities would l e a d t o a number of major t r a n s p o r t c a p a c i t y p roblems, n e c e s s i t a t i n g l a r g e - s c a l e e x p a n s i o n of th e n a t i o n a l t r a n s p o r t system. I n t u r n , t h e s e needs were cause f o r new p l a n n i n g and programming i n i t i a t i v e s t o put i n p l a c e t h e r e q u i r e d 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 t h e d i s t r i b u t i o n of p o p u l a t i o n and economic a c t i v i t y i n a - 137 -s i g n i f i c a n t way and t h e r e b y cope w i t h r e g i o n a l d i s p a r i t i e s . The Task F o r c e was a l s o asked t o f o c u s on s e v e r a l major problem are a s such as a more e f f e c t i v e c o s t r e c o v e r y p o l i c y , a r a t i o n a l i z e d but v i a b l e r a i l p a ssenger system and s t r e n g t h e n i n g of f e d e r a l - p r o v i n c i a l and government-i n d u s t r y r e l a t i o n s . F i n a l l y , t h e Task F o r c e was i n s t r u c t e d t o a d d ress o r g a n i z a t i o n a l i s s u e s , p a r t i c u l a r l y t h e p o l i c y and p l a n n i n g f u n c t i o n w i t h i n t h e department, the r e s p e c t i v e r o l e s of t h e CTC and DOT and t h e r e l a t i o n s h i p between t h e M i n i s t e r and Crown C o r p o r a t i o n s . Based on t h e work of t h e Task F o r c e , t h e M i n i s t e r of T r a n s p o r t t a b l e d , i n June 1975 i n P a r l i a m e n t , h i s p r o p o s a l s f o r new t r a n s p o r t a t i o n p o l i c y o b j e c t i v e s and an o u t l i n e of s e v e r a l program o r g a n i z a t i o n c h a n g e s . 6 3 There were i m p o r t a n t d i f f e r e n c e s between t h e t r a n s p o r t p o l i c y p r i n c i p l e s i n S e c t i o n 3 o f t h e NTA and t h e s u b s t i t u t e p r i n c i p l e s proposed i n 1975. These p r o p o s a l s , among o t h e r t h i n g s , c a l l e d f o r : (1) a t o t a l t r a n s p o r t a t i o n system f o r Canada p r o v i d i n g a c c e s s i b i l i t y and e q u i t y o f t r e a t m e n t f o r u s e r s , c o u l d be an e s s e n t i a l i n s t r u m e n t of s u p p o r t f o r the achievement of n a t i o n a l economic and s o c i a l o b j e c t i v e s ; - 138 -(2) t h e a s s u m p t i o n of r e s p o n s i b i l i t y by government t o a t t e n d t o t h e p r o v i s i o n of an e f f i c i e n t t o t a l system f o r t h i s p u r p o s e ; and (3) u t i l i z a t i o n of t h e most a p p r o p r i a t e mode f o r s p e c i f i c s e r v i c e s . The NTA g o a l s of an, "...economic, e f f i c i e n t and adequate t r a n s p o r t a t i o n system" were de-emphasized i n f a v o u r o f a system p r o v i d i n g f o r t h e s u p p o r t o f n a t i o n a l o b j e c t i v e s and, " . . . a c c e s s i b i l i t y and e q u i t y o f t r e a t m e n t f o r u s e r s " , a phrase w h i c h was c o n s i d e r e d more s p e c i f i c t h a n "adequate". I t was proposed t h a t t h e term " e f f i c i e n t " be r e t a i n e d b u t , at l e a s t r e l a t i v e l y , reduced i n prominence. The M i n i s t e r a l s o announced h i s i n t e n t i o n t o p r o c e e d w i t h new l e g i s l a t i o n t o d e a l w i t h a l l e g e d f r e i g h t r a t e d i s c r i m i n a t i o n r a i s e d a t WEOC and t o change t h e r o l e of t h e CTC. As w e l l , p r o p o s a l s were o u t l i n e d t o d e a l w i t h major c a p a c i t y c o n c e r n s ( e s p e c i a l l y i n w e s t e r n and n o r t h e r n Canada) and t o r e v i t a l i z e r a i l p a s s e n ger wherever t h i s was v i a b l e . I n August 1975, J i m Davey d i e d a c c i d e n t a l l y and t h e Task F o r c e , a l t h o u g h f u n c t i o n i n g under r e t i r e d Deputy M i n i s t e r o f T r a n s p o r t John B a l d w i n , e v e n t u a l l y c e ased t o - 139 -e x i s t . Jean Marchand was e v e n t u a l l y r e p l a c e d by O t t o Lang. W i t h o u t Jean Marchand and J i m Davey t h e t h r u s t t o f u n d a m e n t a l l y change t r a n s p o r t a t i o n p o l i c y t o a l l o w g r e a t e r i n v o l v e m e n t of t h e p r o v i n c e s w i t h e r e d away. N e v e r t h e l e s s , t h e Department of T r a n s p o r t d i d p r e p a r e l e g i s l a t i o n t o g i v e e f f e c t t o some a s p e c t s of t h e Task F o r c e R e p o r t . I t i s i n t e r e s t i n g t o note t h a t reasons f o r a new t r a n s p o r t a t i o n p o l i c y d i d not go away w i t h t h e d e p a r t u r e of J i m Davey and Jean Marchand. But i t appears t h a t a major f a c t o r i n p o l i c y change depends on t h e c a p a b i l i t y and d e t e r m i n a t i o n of i n d i v i d u a l s . The same fundamental q u e s t i o n a r i s e s i n t h i s t h e s i s , t h a t d e s p i t e t h e s t r o n g e v i d e n c e and i n t e r e s t group s u p p o r t f o r changes t o t h e Crow R a t e , t h e i n i t i a l t h r u s t a t l e a s t depended on t h e commitment o f one i n d i v i d u a l - Jean-Luc P e p i n . L e g i s l a t i v e P r o p o s a l s ( B i l l C - 3 3 and C - 2 0 ) B i l l C-33 was i n t r o d u c e d i n t h e House o f Commons i n 1977 t o amend t h e National Transportation Act (1968) and the Department of Transport Act f o r t h e purposes o f r e - d e f i n i n g t he o b j e c t i v e o f n a t i o n a l t r a n s p o r t p o l i c y , a u t h o r i z i n g - 140 -t h e consequent rearrangement of r e l e v a n t powers and d u t i e s o f t h e CTC and t h e department and t o amend t h e Railway Act i n r e s p e c t o f f r e i g h t r a t e s and o t h e r m a t t e r s . B i l l C-33 can be c o n s i d e r e d i n t h r e e p a r t s : (1) t h e o b j e c t i v e s and p r i n c i p l e s s e c t i o n ; (2) t h e Department/ Commission r e l a t i o n s s e c t i o n , and (3) t h e f r e i g h t r a t e s s e c t i o n . The p r o v i n c i a l governments, p a r t i c u l a r l y t h o s e i n A t l a n t i c Canada and t h e p r a i r i e s , p l a c e d c o n s i d e r a b l e i m p o r t a n c e on t h e o b j e c t i v e s and p r i n c i p l e s s e c t i o n e s p e c i a l l y on t h e n o t i o n t h a t t r a n s p o r t a t i o n s h o u l d be r e s p o n s i v e t o r e g i o n a l economic development g o a l s . In c o n t r a s t , c a r r i e r s and s h i p p e r s were c o n c e r n e d t h a t t h e r o l e of e f f i c i e n c y and c o m p e t i t i o n , as c u r r e n t l y embodied i n t h e NTA, was b e i n g made sec o n d a r y t o s o c i a l and economic development o b j e c t i v e s . B o th i n d u s t r y and t h e p r o v i n c e s welcomed t h e proposed c l a r i f i c a t i o n o f t h e M i n i s t e r ' s r o l e i n p o l i c y development and t h e CTC's r o l e i n r e g u l a t i n g t r a n s p o r t a t i o n . O n l y t h e new power of p o l i c y d i r e c t i v e s f o r t h e G o v e r n o r - i n - C o u n c i l t o t h e CTC were c h a l l e n g e d . Both groups were i n f a v o u r o f a s t r e a m l i n e d a p p e a l s p r o c e d u r e under S e c t i o n 23 of t h e NTA - 141 -NTA and urged f u r t h e r b r o a d e n i n g of t h e b a s i s f o r a p p e a l s and an a c c e l e r a t i o n up of t h e a p p e a l s p r o c e s s . There was a good d e a l of o p p o s i t i o n t o t h e package of f r e i g h t r a t e l e g i s l a t i v e changes t h a t was proposed. S h i p p e r s and c a r r i e r s g e n e r a l l y opposed t h e p r o v i s i o n s t o change t h e minimum and maximum r a t e r e g u l a t i o n s . O n t a r i o , Quebec and t h e A t l a n t i c p r o v i n c e s were g e n e r a l l y d i s -s a t i s f i e d w i t h t h e f r e i g h t r a t e s e c t i o n because, from t h e i r v i e w p o i n t , i t proposed too much i n t e r v e n t i o n . The p r a i r i e p r o v i n c i a l governments viewed i t as a s t e p i n t h e r i g h t d i r e c t i o n . A key element of B i l l C-33 was t h a t w h i l e t r a n s p o r t was t o become " e f f i c i e n t " , i t was a l s o t o become an i n s t r u m e n t of s u p p o r t f o r t h e achievement of n a t i o n a l and r e g i o n a l , s o c i a l and economic o b j e c t i v e s and t o p r o v i d e e q u i t y of t r e a t m e n t f o r u s e r s . There were e l e v e n p r i n c i p l e s i n a l l c o n t a i n e d i n t h e l e g i s l a t i o n . P r o f e s s o r s Heaver and N e l s o n argued t h a t t h e new l e g i s l a t i o n was m i s g u i d e d ...and t h a t changes would run t h e r i s k o f l e a d i n g t o d e c i s i o n s c o n t r a r y t o t h e e f f i c i e n t p r o v i s i o n o f t r a n s p o r t s e r v i c e s w h i l e e x a c e r b a t i n g r e g i o n a l d i s s a t i s f a c t i o n as a r e s u l t o f t h e f a i l u r e of r e a l i t y t o match t h e e x p e c t a t i o n s w h i c h t h e r e v i s e d - 142 -s t a t e m e n t of p o l i c y may engender. B i l l C-33 d i e d on t h e Order Paper i n 1977. Because o f i n t e r e s t on t h e p a r t o f b o t h t h e A t l a n t i c and p r a i r i e p r o v i n c e s , i t was r e i n t r o d u c e d i n a somewhat r e v i s e d form as B i l l C-20 i n November 1978, i m m e d i a t e l y p r i o r t o t h e F i r s t M i n i s t e r s ' C o n f e r e n c e . I n es s e n c e , i t was s i m i l a r t o B i l l C-33 a l t h o u g h t h e r e were some changes i n t r a n s p o r t o b j e c t i v e s and p r i n c i p l e s , and t h e power of p o l i c y d i r e c t i v e s from t h e G o v e r n o r - i n - C o u n c i l t o t h e CTC was d e l e t e d . The work o f t h e Davey Task F o r c e was a l s o a good example o f executive federalism a t work. F e d e r a l and p r o v i n c i a l m i n i s t e r s and o f f i c i a l s had e s t a b l i s h e d f o r m a l and i n f o r m a l l i n k s w h i c h l e d t o t h e t h r u s t c o n t i n u e d i n B i l l C-33. C a r r i e r s and some s h i p p e r s g e n e r a l l y were opposed t o t h e l e g i s l a t i o n , p a r t i c u l a r l y t o t h e r o l e e n v i s i o n e d f o r t h e M i n i s t e r o f T r a n s p o r t . I n summary, t h e work of t h e Davey Task F o r c e and B i l l s C-33 and C-20 r e f l e c t e d a d e s i r e by government t o use t r a n s p o r t a t i o n p o l i c y b o t h as a means f o r a c h i e v i n g a g r e a t e r degree o f c o m p e t i t i o n and e f f i c i e n c y , and t o a s s i s t i n t h e r e a l i z a t i o n o f n a t i o n a l and r e g i o n a l - 143 -o b j e c t i v e s . The i n i t i a t i v e f a i l e d , p r o b a b l y because u s e r s / s h i p p e r s f e a r e d t h e consequences o f 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 as t h e y would a f f e c t t r a n s p o r t a t i o n p o l i c y . The r e m a i n i n g c h a r a c t e r i s t i c of t r a n s p o r t a t i o n p o l i c y t o be d i s c u s s e d i s t h a t o v e r r i d i n g p u z z l e o f t r a n s p o r t a t i o n p o l i c y a d v i s o r s , c o n c e r n i n g t h e r o l e o f t r a n s p o r t a t i o n as e i t h e r a s e r v i c e i n d u s t r y r e s p o n d i n g t o d e r i v e d demand, or as means o f a d d r e s s i n g n a t i o n a l and r e g i o n a l g o a l s and o b j e c t i v e s . S i n c e t h e Crow Rate was caught up w i t h i n t h i s conundrum an attempt w i l l be made t o d i s c u s s a s p e c i f i c i s s u e : w e s t e r n f r e i g h t r a t e g r i e v a n c e s as a means of i d e n t i f y i n g t h e c o n t e x t of " p r o v i n c i a l p o l i t i c s " d u r i n g t h e r e s o l u t i o n o f t h e Crow Rate. The i s s u e o f f r e i g h t r a t e g r i e v a n c e s w i l l be a n a l y z e d from b o t h a p u b l i c p o l i c y and a f e d e r a l - p r o v i n c i a l r e l a t i o n s p e r s p e c t i v e . The f o u r w e s t e r n p r o v i n c e s have h i s t o r i c a l l y argued t h a t r a i l w a y f r e i g h t r a t e s d i s c r i m i n a t e a g a i n s t t h e o p p o r t u n i t i e s t o e s t a b l i s h more v a l u e - a d d e d p r o c e s s i n g of raw p r o d u c t s i n t h e i r r e g i o n . T h i s r a i s e s t h r e e c o n c e r n s . F i r s t , i s t h e r e s u b s t a n c e t o t h e argument t h a t r a i l w a y f r e i g h t r a t e s a r e e s t a b l i s h e d by CN and CP t o d i s c r i m i n a t e a g a i n s t t h e west? Second, how s i g n i f i c a n t a r e f r e i g h t r a t e s i n d e t e r m i n i n g i n d u s t r y l o c a t i o n ? , and - 144 -t h i r d , s h o u l d t h e t r a n s p o r t system be m a n i p u l a t e d t o s u p p o r t r e g i o n a l economic g o a l s ? . S e c t i o n 3 of t h e NTA w h i c h i s t h e b a s i c p o l i c y s t a t e m e n t of t h a t A c t s t a t e s t h a t t h e r e s h a l l be, "an economic, e f f i c i e n t and adequate t r a n s p o r t a t i o n system." T h i s s t a t e m e n t r e p r e s e n t s t h e f i r s t attempt t o c r e a t e a p o l i c y framework f o r t r a n s p o r t a t i o n as a whole, not j u s t as a r a i l w a y problem. Moreover, a c c o r d i n g t o B a l d w i n 6 5 i t was one of t h e f i r s t s t a t u t e s t o l a y down a framework of p o l i c y , a commendable c o u r s e of a c t i o n . However commendable t h i s i n i t i a t i v e was, B a l d w i n (Deputy M i n i s t e r o f T r a n s p o r t when t h e 1967 l e g i s l a t i o n was p a s s e d ) , does admit t h a t t h e p r i n c i p l e s and p r o c e s s e s of t h e s t a t u t e were not f o l l o w e d and t h a t n e i t h e r government nor t h e p u b l i c f u l l y u n d e r s t o o d whether S e c t i o n 3 r e l i e d s o l e l y on c o m m e r c i a l f o r c e s o f i n t e r - m o d a l c o m p e t i t i o n and a r e g u l a t o r y system t o meet i t s o b j e c t i v e s o r d i d S e c t i o n 3 i m p l y t h a t government had a d i r e c t r o l e i n t h e o v e r a l l r e s p o n s i b i l i t y f o r t h e t r a n s p o r t a t i o n s y s t e m . 6 6 T h i s r a i s e s a s e r i o u s q u e s t i o n as t o t h e purpose of p l a c i n g i n l e g i s l a t i o n s e c t i o n s upon w h i c h t h e r e i s no a c c e p t a b l e d e f i n i t i o n nor i s t h e r e an u n d e r s t a n d i n g of how t h e s e c t i o n i s t o be a p p l i e d t o s p e c i f i c s i t u a t i o n s . I t a l s o r a i s e s q u e s t i o n s as t o t h e manner i n w h i c h th e words i n t h e s e c t i o n were d r a f t e d . - 145 -L e g i s l a t i o n i s o f t e n d r a f t e d i n vague terms t o a v o i d r i g i d i n t e r p r e t a t i o n s from u n d e r m i n i n g t h e l e g i s l a t i o n ' s i n t e n t i o n . T r a n s p o r t a t i o n , as t h i s t h e s i s has a l r e a d y advanced, i s c o n t i n u a l l y e x p e c t e d t o f o r w a r d a wide range o f s o c i a l and p o l i t i c a l g o a l s . L a n g f o r d n o t e s t h e b a s i c c o n f l i c t * i n S e c t i o n 3 between an 'adequate' and ' e f f i c i e n t ' t r a n s p o r t a t i o n s y s t e m . 6 7 W e s t m a c o t t 6 8 examined t h e r o l e of t h e t h r e e p r a i r i e governments d u r i n g passage of t h e 1967 l e g i s l a t i o n and he d i s c o v e r e d t h a t t h e r e was no c o n s i s t e n t r e g i o n a l p o s i t i o n . M a n i t o b a and Saskatchewan were appeased by t h e f e d e r a l government's d e c i s i o n t o exempt t h e Crow Rate from t h e NTA p r o v i s i o n s and t o remain p a s s i v e on t h e i s s u e o f b r a n c h l i n e abandonment. The government o f A l b e r t a a d v o c a t e d fundamental changes t o t h e f r e i g h t r a t e s t r u c t u r e . Westmacott o b s e r v e s t h a t : " . . . c o n s u l t a t i o n s 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 c o n s u l t a t i o n s between f e d e r a l 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 g e n e r a l i n n a t u r e t h a t t h e p r o v i n c i a l governments were u n c e r t a i n as t o t h e p r e c i s e n a t u r e of t h e f e d e r a l p r o p o s a l s u n t i l t h e l e g i s l a t i o n was t a b l e d i n t h e House o f Commons." 6 9 The f e d e r a l M i n i s t e r of T r a n s p o r t , Mr. P i c k e r s g i l l , t o o k t h e p o s i t i o n t h a t he d i d not have t o c o n s u l t t h e p r o v i n c e s b e f o r e i n t r o d u c i n g l e g i s l a t i o n t h a t i s e x c l u s i v e l y w i t h i n t h e j u r i s d i c t i o n of t h e f e d e r a l p a r l i a m e n t . 7 0 The e l e c t i o n of Mr. Trudeau i n 1968 us h e r e d i n a new er a o f c o n s u l t a t i o n w i t h t h e p r o v i n c e s . The new Prime M i n i s t e r e s t a b l i s h e d ' r e g i o n a l d e s k s ' * t o keep him i n f o r m e d of t h e i s s u e s o u t s i d e Ottawa. C o n c u r r e n t l y t h e r e was growing r e c o g n i t i o n i n w e s t e r n Canada t h a t i t must d e v e l o p a more common, u n i f i e d , r e g i o n a l p o s i t i o n on m a t t e r s c o n c e r n i n g t h r e e p r a i r i e p r o v i n c e s and, a t t i m e s , t h e f o u r w e s t e r n p r o v i n c e s . A P r a i r i e Economic C o u n c i l was e s t a b l i s h e d i n 1965 and one o f i t s f i r s t p r i o r i t i e s was t o d e v e l o p a t r a n s p o r t a t i o n p o l i c y . The newly e l e c t e d (1971) P r e m i e r o f A l b e r t a acknowledged t h a t : *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 r e g i o n w i t h d i f f e r i n g p o l i t i c a l a f f i l i a t i o n s and t h e e x i s t e n c e o f problems p e c u l i a r t o o n l y one p r o v i n c e i n h i b i t t h e development o f a r e g i o n a l p o l i c y p o s i t i o n . " 7 1 The 1983 Crow Rate debate s u p p o r t s t h e s u p p o s i t i o n made by P r e m i e r Lougheed t w e l v e y e a r s e a r l i e r . A n o t h e r f e d e r a l e l e c t i o n i n 1972 was t o have a f a r -r e a c h i n g impact on t h e m a t t e r o f f r e i g h t r a t e s i n w e s t e r n Canada. The L i b e r a l Government dropped 46 s e a t s o v e r a l l and found i t s e l f i n a m i n o r i t y p o s i t i o n . I t l o s t 12 s e a t s i n B r i t i s h Columbia and i t s p r a i r i e t o t a l dropped t o 3 s e a t s from 7 i n 1968. As a r e s u l t , t h e ' r e g i o n a l d e s k s ' were dropped and a Western Economic O p p o r t u n i t i e s C o n f e r e n c e was e s t a b l i s h e d t o e x p l o r e p o t e n t i a l s f o r 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 C o n f e r e n c e (WEOC) On J u l y 24-26, 1973 a r a r e event t o o k p l a c e i n C a l g a r y . The f e d e r a l government, r e p r e s e n t e d by t h e Prime M i n i s t e r and s e v e r a l s e n i o r C a b i n e t M i n i s t e r s , met w i t h t h e f o u r w e s t e r n P r e m i e r s t o d i s c u s s t h e economy of w e s t e r n Canada. I t was an o p p o r t u n i t y f o r t h e west - 148 -l o g i c a l l y and d e f i n i t i v e l y t o l a y out i t s d e e p l y r o o t e d c l a i m o f g r i e v a n c e s . I n t h e i r opening comments t o t h e Prime M i n i s t e r , t h e w e s t e r n P r e m i e r s s a i d : "The p a t t e r n of s e t t l e m e n t and development has 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 a s s i s t e d t h e c o n c e n t r a t i o n of t h e n a t i o n ' s b u s i n e s s and i n d u s t r i a l a c t i v i t y i n c e n t r a l 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 c o n c e n t r a t i o n of f i n a n c i a l and i n d u s t r i a l r e s o u r c e s and p o p u l a t i o n , have worked a g a i n s t t h e a l l o c a t i o n of f i n a n c i a l 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 b a l a n c e t o economies o f a l l r e g i o n s of C a n a d a . " 7 2 For h i s p a r t Mr. Trudeau, i n h i s major address at WEOC, argued, " . . . t h a t i t was tim e t o r e - t h i n k t h e t r a d i t i o n a l d i v i s i o n o f l a b o u r between t h e w e s t e r n h i n t e r l a n d and t h e c e n t r a l m e t r o p o l e . " 7 3 A f t e r f i r i n g t h i s b r o a d s i d e a t t h e s t a p l e p r o d u c t i o n t h e o r y Mr. Trudeau s t a t e d , " R e g i o n a l and economic s p e c i a l i z a t i o n must be reduced and Ottawa must p u r s u e , as a b a s i c p o l i c y g o a l , t h e development o f b a l a n c e d and d i v e r s i f i e d r e g i o n a l economies a c r o s s t h e l a n d . " 7 4 The l i t a n y of w e s t e r n g r i e v a n c e s o u t l i n e d a t WEOC were c l a s s i c and d e e p l y r o o t e d , r a n g i n g from a t t a c k s on t h e ba n k i n g system t o f e d e r a l p u r c h a s i n g p r a c t i c e s but two of - 149 -t h e major are a s of c o n c e r n r a i s e d were t h a t t h e Canadian t a r i f f s t r u c t u r e and d i s c r i m i n a t o r y p r i c i n g by t h e R a i l w a y s ' i n h i b i t l o c a t i o n of i n d u s t r y on t h e p r a i r i e s and, i n t u r n , f a v o u r c e n t r a l C a n a d a . 7 5 Table 6 o u t l i n e s t h e l i s t o f p r o p o s a l s put f o r w a r d by th e f o u r w e s t e r n P r e m i e r s at WEOC. The l i s t i s dominated by r a i l o r i e n t e d items and, i n e v e r y c a s e , f e d e r a l e x p e n d i t u r e was r e q u i r e d . The c o s t i n 1975 t o t a k e over t h e road-beds a l o n e was e s t i m a t e d t o be i n e x c e s s of $3 b i l l i o n d o l l a r s . T a b l e 6: 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 by  Western P r e m i e r s a t WEOC (1973) 1. S e c t i o n 3 (NTA) t o r e f l e c t r e g i o n a l economic o b j e c t i v e s . 2. F e d e r a l 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. 3. E s t a b l i s h m e n t o f a f e d e r a l - p r o v i n c i a l i n s t i t u t i o n t o s e t f r e i g h t r a t e s . 4. F e d e r a l government t o purcha s e roadbed o f CN and CP R a i l . 5. P r o v i n c i a l i n p u t i n t o r a t i o n a l i z a t i o n o f b r a n c h l i n e s and f e d e r a l government t o pay compensation t o a f f e c t e d p a r t i e s . 6. Improved p o r t f a c i l i t i e s at P r i n c e R u p e r t and C h u r c h i l l . 7. C o n s t r u c t a r a i l 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 connect BCR w i t h CN/CP R a i l . S o u r c e : Premiers' Transportation Position Paper (WEOC) 1973 - 150 -Table 7 o u t l i n e s t h e programs and p o l i c i e s of the f e d e r a l Department of T r a n s p o r t a r i s i n g out o f t h e WEOC Co n f e r e n c e . I t s h o u l d be p o i n t e d out t h a t many o f t h e programs l i s t e d were committed e x p e n d i t u r e s w i t h o u t any r e l a t i o n s h i p t o WEOC. The main e x c e p t i