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The effect of the Panama Canal on western Canada Allan, Dalton Dodd 1938

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THE EFFECT OF 'MB PANAMA CANAL ON WESTERN CANADA. "by B a i t o n D. A l l a n . A t h e s i s submitted i n p a r t i a l f u l f i l m e n t of the requirements f o r the degree of Master of A r t s i n the Department of Economics U n i v e r s i t y o f B r i t i s h Columbia, March. 1938. TABLE OF COM'Bi'ITS 'CHAPTER SUBJECT PAGE I I n t r o d u c t i o n . 1 I I "An Economic Hevi ew , »» 4 I I I An H i s t o r i c a l Sketch of the Isthmian Boute.»,.,. 11 . IV The Scope of the Invest!gat i o n . 16 V Ganadian Economic Development ................. 20 VI Western Canada 47 V I I B r i t i s h Columbia * 21 V I I I General E f f e c t s of the Canal .......... 112 IX • E f f e c t s of the Canal on. Canadian Wheat ......... 12? X Conclusion ..................................... 167 P o s t s c r i p t . 170 Bibliography 172 Aa Scoiioittic Bsviet? <>.,«.».....c<...•••»»«••» An H i s t o r i c a l Skatcli of the Istlsnisit Boute She Scope of the I n v e s t i g a t i o n c...«...*.••« Caaadiaa Economic :Developiisaxii .» . .< . .« , . . . . . Bsstssyn CatiEtcla *:»•*.#•**-4«• •»«».»<• *••*« • » » «*••••.»»•.•» !B^x*bh OoitHdbxs, »«.«««.*»«t>:»«4«»»:«'«f »« genera l Siffeets of the Canal « > . » . . . . . . , . , « E f f e c t s o f tae Caiwxl ori tJanaflian Wheat .oV* COHC<X"U.SX033. ^ *> « 0 * 0 -e « « .* ».,t> w- «•»••* « .« «-«> «• • » •* «a •» « * « INDEX OP FIGURES F i g , 1* 'Canadian P o p u l a t i o n , 1901-1936 - ^ f j 49 50 51 52 54 55 _ . . . . . . . . . . . . . . F i g . 2 Western Canadian P o p u l a t i o n , 1901-1936.. ..... 25 F i g . 3 Canadian Exports and Imports, 1900-1936. 31 F i g . 4 Percentage of Canadian Exports to U.S. & Other Countries 42 F i g . 5 Percentage of Canadian Imports to U.S. & Other Countries 43 F i g , 6 Canadian Imports, 1906-1920....... F i g . 7 Western Canada Imports, 1906-1920. ' F i g . 8 Canadian Imports, 1920-1936 F i g . 9 Western Canada Imports, 1920-193 6 Fig.10 Canadian Exports, 1906-1920 F i g . 11 Western. Canada Exports, 1906-1920, Fig.12 Canadian F i g * 15 Western Canada Exports, 192Q-1936. • 57 Fig.14 Panama T r a f f i c from West Coast of Canada,. 1321-1936 62 F i g * 15 Manitoba Imports, 1906-1920* •,. + 65 •&1 r» K C ~ J- ' ' - Cf: « « « o « « « * « * « « o o « 67 * * « * • e « « « » a A 9 » o 68 o » » » a • •* * • « e » e « « • 70 • • • • a a « » » « e a o 71 Fig.16 Saskatchewan Imports, 1906-1920....... Fig.17 A l h e r t a Imports, 1906-1920 ...... Fig,18 B r i t i s h Columbia Imports, 1906-1920... Fig.19 Manitoha Imports, 1920-1936.....,.,,.. F i g . 20 Saskatchewan Imports, 1920-1936..,.,., Fig.21 A l b e r t a Imports, 19 20-1936 • -Fig.22 B r i t i s h Columbia Imports, 1920-1956. F i g , 23 Manitoba Exports, 1906—1920, »......,<...<,...... 75 Fig.24 Saskatchewan Exports, 1906-1920 74 F i g , 25 Alb e r t a Exp o r t s , 1906-1920 ,....<>.. 75 Fig.26 B r i t i s h Columbia Exports, 1906-1920..................... 76 Fig,27 Manitoba Exports. 1920-1936 , , 77 Fig.28 Saskatchewan Exports, 1920-1936 78 Fig.29 A l b e r t a Exports, 1920-1936,...................... , 79 Fig.30 B r i t i s h Columbia Exports, 1920-1936..................... • 80 Fig,31 Vancouver Imports as a Percentage of B.C.Imports,1908-36 95 Fig.52 Vancouver Exports as a Percentage of B.C.Exports, 1908-56 96 Fig,53 Vancouver Imports, 1908-1920 , 88 Fig,34 Vancouver Imports, 1920-1956., 99 Pig,55 Vancouver Exports, 1 9 0 8 - 1 9 2 0 1 0 0 Fig.56 Vancouver Exports, 1920-1936 ............ ,. 101 Fig.37 Vancouver Trade v i a Panama, 1921-1935, Imports... 107 Fig.38 Vancouver Trade v i a Panama, 1921-1955, Exports....,..,,. 108 Fig,39 . P r o v i n c i a l G r a i n P r o d u c t i o n as a Percentage of T o t a l Western Canadian P r o d u c t i o n (Wheat only) 1915-1935... 136 Fig.40 P r o v i n c i a l . G r a i n P r o d u c t i o n as a Percentage of T o t a l Western Canadian P r o d u c t i o n (Wheat,Oats,Barley,Rye) 1915-35 157 Fig.41 Comparison of Vancouver Exports and Alta.Crops, 1922-55.. 142 Fig.42 Comparison of Vancouver Exports and Aita.-Sask Crops/'" 143 Fig.45 Comparison of Vancouver Exports and Sask.Crops,1922-55.. 143 Fig.44 Comparison of Vancouver Exports and Man. Crops, 1922-55. 144 Fig,45 Average Annual Cost of T r a n s p o r t i n g One Bushel of Wheat from Canada t o L i v e r p o o l (a) v i a Montreal ("b) v i a Vancouver-Panana.... 'N 150 Fig,46 Index of A t l a n t i c and P a c i f i c F r e i g h t Rates on Wheat.... 153 Fig.47 Comparison of P a c i f i c F r e i g h t Rates and B.C. Exports,... 154 INDEX OF TABLES. Table 1 Table 2 Table 3 . Table 4 Table 5 Table 6 Table 7 Table 8 Table 9 Table 10 Table 11 Table 12 Table 13 Table 14 Table 15 Table 16 Table 17 Table 18 Table 19 Table 20 Table 21 Table 22 Table 23 Table 24 Table 25 Table 26 Table 27 Table 28 Table 29 Table 30 Table 31 World's Shipping Tonnag e, Page "T • • • »• • « • • » » J» ii e o i !) « » Quantum of World Trade, Indexes o f Value i n U.S. Gold D o l l a r s , i n S t e r l i n g , of Gold P r i c e s , of Shipping ,A.0"t> l " V " l " f e y 5 19 29 ™19 t$5 9»»*»#»oea* «w»*»*©»«o«#««»&« Net P o p u l a t i o n Increases, 1921-1934-, P o p u l a t i o n Growth, 1901-1956............ P o p u l a t i o n Western P r o v i n c e s , 1901-1914..... Canadian Steam Railway Mileage, 1900-1914... Canadian Imports and Exports, 1900-1936. Ten Leading Canadian Imports and Exports, 1900-1936.. The Percentage of Canadian Exports and Imports to and from c o u n t r i e s other than the U n i t e d S t a t e s , 1900-1936 Panama T r a f f i c ( i n long tons) , 1921-1936 Imports by Pr o v i n c e s , 1900-1936...................... Exports by Province s , 1900-1936, Annual Percentage Increase or Decrease i n Exports and I l l X p 02^"fc S j 190 6™ 19 • & • 9 * • • * • # 9 * o e * * + * * • « * * * + * * * * m * * * o tt B.C. Exports and Imports as a Percentage of Western Canada Exports and Imports, 1906-1936................ Imports and Exports f o r F i v e P r i n c i p a l P o r t s o f B r i t i s h Columbia, 1908-1936. ...„•> Vancouver Trade by Areas, 1921-1936. T o t a l Vancouver Tonnage, l e s s F o r e i g n Coastwise and B r i t i s h Columbia Coastwise (Deep Sea only),1921-1936. Vancouver and lew Westminster Waterborne Exports and Imports to and from E a s t e r n Canada, 1928-1934. T r a f f i c t o and from the East and West Coasts of Canada v i a the Panama Canal, 1921-1936. Wheat P r o d u c t i o n i n Western Canada, by Pr o v i n c e s , 1908-32 1 20 Table of Distances from Vancouver, B.C. to A t l a n t i c and Europe an P o r t s ( v i a Panama) Imports of P r i n c i p a l Wheat Importing C o u n t r i e s , 19 «5«3""* IS «5t) » o i s ^ o w w a o e a * E x p o r t s of P r i n c i p a l Wheat E x p o r t i n g C o u n t r i e s , 19 S3***19 <3G« 0 « 4 * « 9 * » « a 9 G r a i n P r o d u c t i o n by P r o v i n c e s , 1915-1935............. The G r a i n Movements of t h e Western I n s p e c t i o n D i v i s i o n by Crop Years, 1920-1935... . ........... D i s p o s i t i o n o f Canadian Grain, by Crop Tears,1920-35. The Average Annual Cost of Transporting One Bushel of Wheat from Canada to L i v e r p o o l (a) v i a Montreal (b) v i a Vancouver-Panama A t l a n t i c and P a c i f i c F r e i g h t Hates on VV'heat, 1921-1935 American P a c i f i c Coast Exports and Imports, 1922-1930 Summary of E l e v a t o r Storage Capacity by Pr o v i n c e s . . . . Vancouver G r a i n Shipments by Months, 1929-1935,...,,. 9 9 22 23 28 30 35 41 60 81 - 82 83 89 94 105 110 117 118 123 151 1*32 135 140 141 149 152 157 159 163 CHAPTER I . With t h e p a s s i n g of each decade of the Twentieth Century, s o c i a l and economic phenomena become more and more d i f f i c u l t to analyze and reduce to simple cause and e f f e c t . Rapid change i n all departments of l i f e has become commonplace,, and the continued n e c e s s i t y f o r adjustment a f t e r each change has "brought f o r s o l u t i o n a new s e r i e s of complex problems. The commercial world has b u i l t up an extremely d e l i c a t e mechanism, q u i t e s a t i s f a c t o r y when changes were t a k i n g p l a c e g r a d u a l l y , but much too s e n s i t i v e when subjected t o s u c c e s s i v e , extreme changes. The e f f e c t s o f sudden disturbances i n any p a r t of t h e w o r l d are now f e l t , not only l o c a l l y , hut at the v e r y f i n a n c i a l nerve centers - London, P a r i s , and Hew York - and from there, spread to a l l quarters of the globe. The whole s t r u c t u r e i s i n a c o n t i n u a l s t a t e o f o s c i l l a t i o n , and i t thus becomes most d i f f i c u l t to r e l a t e the past t o the present, and exceedingly, dangerous t o prophesy f o r the f u t u r e . With such a m u l t i t u d e of f o r c e s a t p l a y upon the s t r i n g s of human a c t i v i t y , with such v a r i e d and changing e f f e c t s , one i s faced with the prospect of having the c o n c l u s i o n s drawn from one * s a n a l y s i s p a r t i a l l y or completely upset. Some apparently i r r e l e v a n t event may take place i n the world a t l a r g e , or some new l i g h t may he thrown upon the problem from another angle: immediately, one's considered opinions must then be r a d i c a l l y a l t e r e d . The f i e l d of t r a n s p o r t a t i o n has always been subject to the • i (2) i n f l u e n c e of changes i n other spheres of human a c t i v i t y , and t h i s has he en p a r t i c u l a r l y t r u e during the l a s t 50 y e a r s . As an i n s t a n c e of t h i s , the present Sino-Japanese c o n f l i c t he.s d i s r u p t e d t r a n s p o r t a -t i o n systems, and the c l o s i n g of the port of Shanghai has already d i s l o c a t e d the normal channels of world shipping. I n times past, s h i p p i n g has "been a f f e c t e d , t o a greater or l e s s degree, by a bumper wheat crop i n the Argentine or by a crop f a i l u r e elsewhere, by a shortage of cargo tonnage or by an excess, by h i g h p r i c e s or low. I n f a c t , i n any one of a hundred d i f f e r e n t ways, the progress of t r a n s -p o r t a t i o n may be speeded up or retarded. I t may even he d r i v e n into new channels. On the other hand, changes i n t r a n s p o r t a t i o n and communication, may he the cause, d i r e c t l y or i n d i r e c t l y , of s i g n i f i c a n t changes e l s e -where. I n the l a s t c e n t u r y , the world has seen the steamship completely r e p l a c e the s a i l i n g s h i p , and the r e s u l t has "been an e n t i r e l y new commercial world, one which, i n many re s p e c t s , i s h a r d l y comparable w i t h the p a s t . I n l i k e manner, t h e te l e g r a p h , the w i r e l e s s , the motor-ship, the completion of the Sues Canal, and (more r e c e n t l y ) the Panama Canal - a l l these have gla/yed t h e i r part i n changing the commercial map of the world. This modern, h i g h l y - i n d u s t r i a l i z e d w o r l d c e r t a i n l y presents a multitude of c o n f l i c t i n g ideas, motives, f o r c e s , f a c t s end f i g u r e s . I t i s from these that i t w i l l be our task to attempt to i s o l a t e the f o r c e s which have operated on t he economic l i f e of Western Canada, as a r e s t i l t of the c o n s t r u c t i o n try the United S t a t e s ' government of a canal through the Isthmus of Panama, Before proceeding t o the problem i n hand, i t might be w e l l t o review, very b r i e f l y , some of the more important events of the past 25 years (with p a r t i c u l a r reference t o t h e i r e f f e c t on the economic r e l a t i o n s between n a t i o n s ) , i n order b e t t e r to v i s u a l i s e the s e t t i n g i n which our subject presents itself» * " (4) CHAPTER I I I t i s u n i v e r s a l l y agreed t h a t the Great War was the most d i s r u p t i v e f o r c e t o he f e l t i n the economic and s o c i a l l i f e of the nations of the world d u r i n g the l a s t century, i f not at any time i n the h i s t o r y of the world. I t l e f t to the shipping - world a h e r i t a g e of d i f f i c u l t problems. From 1914 to 1918, huge p r o f i t s were made by the shipowners of both n e u t r a l and b e l l i g e r e n t c o u n t r i e s , i n t r a n s p o r t -i n g war- m a t e r i a l s and food s u p p l i e s to the war zone, These p r o f i t s were eagerly d i s s i p a t e d i n e x o r b i t a n t p r i c e s for more ships,. This a d d i t i o n a l tonnage, bought at i n f l a t e d p r i c e s , paid handsome div i d e n d s only as long as the abnormal war c o n d i t i o n s p r e v a i l e d , hut when the war was over, i t soon became a heavy burden on the owners. With the s i g n i n g of the A r m i s t i c e , r i g i d war-time regimentation came to an end, a war-weary world s t r u g g l e d back to peace-time occupations, and a v a i l a b l e cargoes and f r e i g h t r a t e s dropped to new low l e v e l s , Ships b u i l t i n e. p e r i o d of high p r i c e s could no longer make a r e t u r n on t h e i r owners' investment, and i n many cases i t was considered more expedient t o t i e them up, r a t h e r than operate at a l o s s . This s i t u a t i o n remained p r a c t i c a l l y u n a l t e r e d , r i g h t down to the e a r l y months of 1937, 18 years a f t e r the war ended. However, i t i s estimated by competent shipping men t h a t i n the l a s t s i x months of 1957, shipping r a t e s rose over 200%, and they intim a t e that t h i s was due, ' p r i m a r i l y ,•• to two t h i n g s - a systematic scrapping of out-of-date tonnage, b u i l t d u r i n g the war, and t o the recent, appreciable g a i n • I (5) i n p r o f i t a b l e cargo tonnage. Another r e s u l t of the Great War was the growth of a keen r i v a l r y between natio n s i n a l l branches of i n t e r n a t i o n a l economic l i f e . The "war t o end war" did not promote g r e a t e r amity between n a t i o n s , as most people expected. On the contrary, i t engendered a more pronounced n a t i o n a l consciousness, which found e x p r e s s i o n i n r i g i d immigration r e s t r i c t i o n s , higher and s t i l l higher t a r i f f s , and a very keen type of competition for the a v a i l a b l e s h i p p i n g business of the world. I t i s estimated, for i n s t a n c e , t h a t by 1954, the American s h i p p i n g f l e e t was 382% l a r g e r than i n 1914, that of Japan had increased 158,5%, and that of I t a l y 101%. The c o u n t r i e s c i t e d are only three of the more prominent competitors w i t h Great B r i t a i n i n the post-war years f o r a s h r i n k i n g cargo tonnage, Whereas Great B r i t a i n c a r r i e d the b u l k of world cargoes p r i o r t o the War, she has s i n c e been hard-pressed to maintain a moderate lead over her nearest r i v a l s . E a r l y i n 1916, the U n i t e d S t a t e s , at the i n s t i g a t i o n of the A l l i e s , s t a r t e d on a program of r e - b u i l d i n g her merchant marine - "a most c o s t l y t r i a l - a n c - e r r o r and r a p i d program, which e n t a i l e d the 1 b u i l d i n g of 2000 v e s s e l s at a cost of three b i l l i o n d o l l a r s , " At a l a t e r date, she v i r t u a l l y scrapx^ed the whole scheme, at an estimated l o s s of f i v e b i l l i o n d o l l a r s * I t i s q u i t e obvious t h a t " t h i s h e r i t a g e has been " 2 an extremely u n s e t t l i n g infltxence i n deep-sea s h i p p i n g " since t h a t time. 1, Mears, E.G. Maritime Trade of We s t e m . U n i t e d St at_es, Stanford, 1935,9, 2, i b i d , 9. • \ (6) Another development of s i g n i f i c a n c e which has taken place i n the shipping world d u r i n g the l a s t 20 years has been the change ' i n type of f u e l used i n the c a r r y i n g t r a d e . O i l has been r a p i d l y r e p l a c i n g coal as a f u e l f or operating s h i p s . In 1914, 89% of the world's ships were u s i n g c o a l ; i n 1934, t h i s p r o p o r t i o n had dropped to 52%. This was a d i s t i n c t disadvantage t o Great B r i t a i n , hut a boon to the United S t a t e s . The l a t t e r , w i t h her extensive o i l f i e l d s I n Texas and C a l i f o r n i a , was i n a much b e t t e r p o s i t i o n to compete w i t h B r i t a i n , who, up to t h a t time, c a r r i e d the hulk of the world's cargoes l a r g e l y by v i r t u e of her s t r a t e g i c c o a l s u p p l i e s . The change from c o a l to o i l has been h a r d l y more dramatic than the phenomenal increase i n the number of mot o r s h i p s used. The accompanying t a b l e (Table 1, Page 7} i l l u s t r a t e s t h i s s i t u a t i o n to advantage. I t w i l l be seen that p r i o r to 1926, Lloyd* s o f f i c i a l r e g i s t r y d i d not con s i d e r motorships of suf f i c i e n t importance to warrant a separate c l a s s i f i c a t i o n . I n that year, for the f i r s t time, they d i v i d e d n o n - s a i l i n g v e s s e l s i n t o steamships and motorships. In 1926, the r e g i s t e r e d gross tonnage of steamships over 100 tons was 59 ,177,000; motorships amounted to 3,493,000 tons; and the t o t a l world tonnage was 61,784,000 tons. At that time, motorships comprised approximately 5% of the t o t a l world tonnage. W i t h i n 10 years, steamship tonnage had a c t u a l l y decreased to 51,714,000 tons, a drop of over 12%, while motorships had increased by over 40 0% to 12,290,000 tons, the t o t a l world tonnage remaining very n e a r l y the same. At the present time, . (?) TABLE 1 WORLD'S SHIPPING TONNAGE; 100 TONS AND OYER. (000*s of Tons Gross) 1926 59,177 5,493 1927 58,995 4,270 1928 59,727 5,432 1929 59,779 6,628 1930 59,927 8,096 1951 59.291 , 9,431 1932 58,529 10,083 1935 56,427 10,200 1934 1955 52,422 11,304 1956 51,714 , 12.290 YEAR STEM MOTOR SAIL TOTAL 1 9 1 4 45,403 3,685 49,089 1 9 1 5 45,729 3,532 49,261 1916 45,729 1917 45,729 1918 45,729 1 9 1 9 45,897 3,021 50,919 1920 53,904 3,409 57.514 1921 58,846 3,128 61*974 1922 61,342 3,027 64,370 1923 61,342 - . 1 9 2 4 61,514 2,509 64,023 1 9 2 5 62,380 2,261 , 64,641 2,112 61,784 63,267 1 9795 66,954 1,6 6 6 68 , 0 74 1,583 69,607 1,408 70,151 1,366 . 69,734 1,292 67,920 1,158 64,885 1,058 65,063 * Figures not a v a i l a b l e * we f i n d that motorships comprise approximately 20% of the world tonnage. These changes i n the types of s h i p s have had far-reaching • e f f e c t s . The new v e s s e l s are much more economical t o operate, r e q u i r e l e s s space for f u e l , and have a wider s a i l i n g range than the o l d . E n t i r e l y apart from the d i r e c t e f f e c t s on s h i p p i n g of the above mentioned developments, there have heen other s i g n i f i c a n t events t a k i n g place which have helped to prevent a normal and steady r a t e of growth, The commercial world faced a depression i n 1930-1935 which very n e a r l y took the form of an i n t e r n a t i o n a l catastrophe. The t a b l e on Page 9 (Table 2) shows how r e a l l y serious the s i t u a t i o n was during those years. The q u a n t i t y of w o r l d trade i n 1955 was only 82% of what i t was i n 1929. Trade i n terms of go Id, i . e . , the value of t r a d e , dropped f a r lower than the a c t u a l volume. Such a serious s i t u a t i o n could not but a f f e c t the f i e l d of t r a n s p o r t a t i o n ^ and t h i s i s d r a m a t i c a l l y i l l u s t r a t e d i n the r e c o r d of "Shipping A c t i v i t y " (Tahle 2). I n the year 1955, s h i p p i n g a c t i v i t y very n e a r l y came to a s t a n d s t i l l , being only 18% of the 1929 f i g u r e . Another source of disturbance during t h e post-war p e r i o d has heen the very marked r e d u c t i o n i n the r a t e of p o p u l a t i o n increase i n c e r t a i n European c o u n t r i e s . The annual r a t e of excess of b i r t h s over deaths per 1000 of p o p u l a t i o n i s g i v e n on Page 9 (Tahle 5 ) . This has caused considerahle alarm I n Germany, France, and I t a l y , since i t has been upon man-power th&t they have depended i n the past t o (9) TABLE 2 3.929 1952 1935 1934 1935 Quantum of World Trade (1929 = 100) 100 74.5 75.5 78.5 82.0 Index of Yalue I n U.S. Gold D o l l a r s 100 59.1 35.2 53.9 34.6 Index of Yalue i n S t e r l i n g 100 54.3 51,7 54,9 57,8 Index of Gold P r i c e s 100 52,5 46,5 45.0 42,0 Index of Shipping A c t i v i t y 100 26,0 18,0 35.0 47,0 Source; League of Nations,. World Economic Survey, 1935-1936, TABLE 5 NET POPULATION INCREASES (Per 1000 of population) 1921-25 1926-30 1950 1931 19 &3 (C 1933 1954 Germany 8,8 6.6 6.4 4.8 4.3 3 © 5 7.1 France ........... 2« X 1.4 2.4 1.1 1,5 ,5 1,0 I t a l y ........... 10.8 12.6 10,1 9,1 10.0 10,1 Un i t e d Kingdom 8.0 4.9 5,1 3»8 5,5 2.4 5.5 Sources S t a t i s t i c a l Year Book of the League of Nations, 1954-35. (10) m a i n t a i n economic and p o l i t i c a l s e c u r i t y . Thus, t h i s f a c t o r has encouraged the p r e v a i l i n g trend toward economic n a t i o n a l i s m , w i t h i t s attendant high t a r i f f s , r i g i d c o n t r o l of trade and production, and other measures c a l c u l a t e d to b r i n g economic and s o c i a l s e l f - s u f f i c i e n c y . F i n a l l y , and perhaps the most suggestive development of the Twentieth Century, t h e r e has been the recent challenge of a i r t r a v e l . This mode of t r a n s p o r t a t i o n has not yet encroached to any great extent on f r e i g h t shipments, but i t would he f o o l i s h to deny i t s f u t u r e p o s s i b i l i t i e s . Only r e c e n t l y , i t was reported i n the press that a r e g u l a r f r e i g h t s e r v i c e by a i r had been e s t a b l i s h e d across the E n g l i s h Channel, and that such a r t i c l e s as pianos and household f u r n i t u r e were not uncommon cargoes for the huge a i r l i n e r s. The conque st by the steamship . of the s a i l i n g ship Is much too recent to permit foolhardy d e n i a l s of the p o t e n t i a l c a r r y i n g c a p a c i t y of huge h e a v i e r - t h a n - a i r machines, f o r any or a l l types of cargo. T r u l y , year by year, the world becomes smaller and s m a l l e r , and, at the same time, more and more complex. (11) CHAPTER I I I For c e n t u r i e s , Europeans t r i e d to f i n d the short route west to the Orient. For the most p a r t , such attempts were r e l a t i v e l y u n s u c c e s s f u l , u n t i l 1914. I n that year, the U n i t e d States govern-ment completed a 400 m i l l i o n d o l l a r canal "between the A t l a n t i c and P a c i f i c Oceans over the Isthmus of Panama, I n 1492, Columbus came very near t o t h i s narrow s t r i p of land, hut he had not the f a i n t e s t i d e a of what l a y before him. Some considerable time elapsed before others went f a r t h e r . I t was not u n t i l September 15, 1515, that Balboa accomplished t h i s f e a t . At that time, he landed on the A t l a n t i c s i d e of what i s now Panama, climbed the short distance over the mountains, and became the f i r s t man to view the P a c i f i c Ocean from the ?/estern shores of North America, Ho s e r i o u s attempt was-ms.de to e s t a b l i s h a colony on the Isthmus u n t i l 1698. At that time, a group of S c o t t i s h adventurers formed the Company of Scotland, more f a m i l i a r l y known as the D a r i e n Company, They were organized to trade i n A f r i c a and the I n d i e s , and they e s t a b l i s h e d a colony i n Panama, "The express purpose of t h i s undertaking was the development of a t r a n s - i s t h m i a n route, probably overland, which would immeasurably f a c i l i t a t e European trade w i t h the Far East and l i k e w i s e d e l i v e r c o n t r o l o f world trade to those who 1 h e l d the key to t h i s r o u t e . " 1« Hears, op. c i t . , 120, . (12) I n the middle of the nineteenth century, Louis Napoleon, much maligned f o r h i s d i s a s t r o u s adventures i n f o r e i g n p o l i c y , made • an u n s u c c e s s f u l attempt to set h i s b r o t h e r , Maximalien, on the throne of Mexico, He encountered unexpected o p p o s i t i o n from Mexico and the U n i t e d S t a t e s , which brought to an end h i s dreams of empire i n America. However, w i t h amasing f o r e s i g h t , he saw the s i g n i f i c a n c e of t h i s narrow s t r i p of land, the Isthmus of Panama, and he r e a l i z e d the p o t e n t i a l power of any country c o n t r o l l i n g a c a n a l b u i l t at t h i s spot. I t was not u n t i l the discovery of gold i n C a l i f o r n i a , i n 1848-49, that r e a l i n t e r e s t developed i n a proposal to b u i l d a c a n a l , e i t h e r through C e n t r a l America or through the Isthmus of Panama, I n 1881, Ferdinand de Lessups,. the famous b u i l d e r of the Suez Canal, s t a r t e d an u n s u c c e s s f u l attempt to b u i l d a canal at Panama. He was defeated l a r g e l y by a combination of circumstances - m a l a r i a , u n f a m i l i a r p h y s i c a l c o n d i t i o n s , and f i n a n c i a l p r o f l i g a c y - and he abandoned the scheme at a l o s s of over 400 m i l l i o n d o l l a r s . In 1904, the United States government commenced the a c t u a l c o n s t r u c t i o n of the present c a n a l , and i t was o f f i c i a l l y opened to t r a f f i c on August 15, 1914, j u s t ten days a f t e r war was d e c l a r e d i n Europe. Although the world's a t t e n t i o n was centered on Europe for the next four years, and,, as a r e s u l t , the canal d i d not have an opportunity to prove i t s r e a l worth, i t was g e n e r a l l y recognized that i t s completion was an event of the utmost s i g n i f i c a n c e , not only t o (13) the U n i t e d S t a t e s , hut to the whole w o r l d . E.G. Hears suras i t up i n t h i s way; "She opening of the Panama Canal to t r a f f i c on August 15, 1914, "brought to a c l o s e another epoch i n the maritime h i s t o r y of the w o r l d . Old trade routes gave way t o new; regions f o r m e r l y cut o f f from each other hy h a r r i e r s to easy communication now found themselves measurably nearer to each other; commodities l i m i t e d to • l o c a l d i s t r i b u t i o n found wider markets.. When man completed what nature so n e a r l y accomplished along the narrow Isthmus between North and South America, m i n g l i n g the water of the A t l a n t i c and the P a c i f i c Oceans, the foundation was l a i d f o r a new commercial e r a . " ' 2 Prophecies i n the past, as to the a c t u a l value of the Panama Canal t o world t r a d e , have been p r a c t i c a l l y u s e l e s s . However, i t i s of i n t e r e s t t o note what was s a i d by one w r i t e r between 1915 and 1920, and to compare h i s p r o g n o s t i c a t i o n s w i t h present f a c t s . W r i t i n g i n 1913, J.S. M i l s s a i d , "The c a n a l i s g o i n g to help America to keep I t s t r a d e more t o i t s e l f , I t represents i n commerce and 5 economics what the Monroe Do c t r i n e represents i n p o l i t i c s . " Viewed i n 1957, t h i s prophecy may have "been i n great measure c o r r e c t , but one would h a r d l y h a i l i t as b e n e f i c i a l i n the l i g h t of present f r o z e n trade c o n d i t i o n s . Again, he s a i d , " A l l the corn and produce of A l b e r t a and Western Saskatchewan w i l l flow, not eastwards as h e r e t o f o r e , but to the P a c i f i c shores,...»" A very pleasant prospect, but we w i l l see as we progress that up to the present, at l e a s t , the Western Canada g r a i n prohlem has not been solved i n so simple a manner as t h a t . 2. Hears, op. c i t . , 116. 5. M i l l s , J.S. The Panama Canal. London, 1915, 282.. 4, i h i d . , 287. 5 (14) He a l s o prophesied a l a r g e increase i n t o u r i s t t r a f f i c from the west coast of North America to Europe as a r e s u l t of the c a n a l -something which has not m a t e r i a l i z e d as yet. W r i t i n g at a l a t e r date,. P.J. Haskin came c l o s e r to the f a c t s when he s a i d , "There w i l l he a sudden re-adjustment of e x i s t i n g trade routes, and t h i s w i l l he fo l l o w e d by a long e r a of development of new c o n d i t i o n s , which w i l l be so gradual as to be almost i m p e r c e p t i b l e , and yet so immense as to e x c i t e the wonder of humanity when i t stops 5 to reckon i t s f u l l e f f e c t and meaning." Developments i n world c o n d i t i o n s s i n c e the canal was opened have been much too r e v o l u t i o n a r y to a l l o w one t o more than hazard a guess, i n very general terms, as to i t s r e a l s i g n i f i c a n c e . Even to-day, 24 years a f t e r i t s opening, the canal's r e a l value i s not c l e a r l y d i s c e r n i b l e . In a p p r a i s i n g the s i g n i f i c a n c e of the c a n a l i n • American economic h i s t o r y , Johnson and Huebner say, "In-aa-much as the cost of t r a n s p o r t a t i o n i s but one f a c t o r a f f e c t i n g the volume of f o r e i g n t r a d e , i t i s not to be expected that the can a l i n i t s e l f 6 w i l l i n s u r e the commercial f u t u r e of the U n i t e d S t a t e s . " I n l i k e manner, n e i t h e r w i l l i t i n s u r e the commercial future of Western Canada. Many other f a c t o r s enter into the p i c t u r e , such as f o r e i g n investments, banking and c r e d i t r e l a t i o n s , the use of e f f e c t i v e t r a d e methods, p o l i t i c a l c o n t r o l of markets, and cou n t l e s s other c o n s i d e r a t i o n s . 5. Haskin, E.J. The Panama Canal. New York, 1914, 357. 5. Johnson & Huebner, P r i n c i p l e s of Ocean T r a n s p o r t a t i o n , New York and London, 1929, 92. . (15) However, since the g r e a t e s t highway of t r a v e l i s the sea, and s i n c e v e s s e l s are of tremendous importance as c a r r i e r s of passen-gers and cargoes, the Panama Canal has had and w i l l continue to have a very marked i n f l u e n c e on the t r a d e of the United S t a t e s , and upon the trade of the whole world. So important has i t become to the U n i t e d States that that country has been c o n s i d e r i n g for some time building- a second c a n a l through Nicaragua to supplement the one at Panama. Perhaps i t s r e a l value would he more d r a m a t i c a l l y i l l u s t r a t e d I f , by some whim of nature (for example, an earthquake) the present canal were destroyed. Then, indeed, we would see how much world trade has grown to depend on t h i s short cut to and from the P a c i f i c , F a i l i n g such a d r a s t i c and w h o l l y undesired e v e n t u a l i t y , students of economics must content themselves w i t h a mi l d e r and more val u a b l e form of i n v e s t i g a t i o n . Undoubtedly, a l l w i l l agree t h a t the Panama Canal was worth t h e cost i n time and l a b o r , both to i t s b u i l d e r s and those who use i t , and that i t s p o t e n t i a l value has yet to he gauged and a c c u r a t e l y measured. " I f the time ever comes, as some eminent geographers p r e d i c t , when the P a c i f i c Coast of North America w i l l support the densest p o p u l a t i o n of the Western world, i t i s safe to say that the Panama Canal w i l l have ulayed a lea d i n g r o l e i n t h i s 7 achievement,' 1 7, Mears, op. c i t . , 146. (16) CHiPTEB I ? The Canadian economy, and more p a r t i c u l a r l y that of Western Cam da, has been i n f l u e n c e d more than a l i t t l e by the c o n s t r u c t i o n of the Panama Canal. So f a r , we have seen the d i f f i c u l t i e s e n t a i l e d i n i s o l a t i n g one phenomenon and a c c u r a t e l y measuring- i t s e f f e c t s . We have seen that no problem can be t r e a t e d i n complete i s o l a t i o n , and that the Panama Csnal i s no ex c e p t i o n . We s h a l l now t r y to estimate the p a r t i c u l a r advantages or disadvantages to Western Canada by the c o n s t r u c t i o n of t h i s waterway, not i n the l i g h t of a short passage to Europej not Western Canada l o o k i n g west, but Western Canada l o o k i n g east. We s h a l l i n v e s t i g a t e , f i r s t of a l l , the general character-i s t i c s of Canadian e x t e r n a l t r a d e , from the t u r n of the century to the present t i n s . I n l i k e manner, we s h a l l study the c h a r a c t e r i s t i c s of Western Canadian t r a d e a c t i v i t y w i t h the outside world. By observing these two to g e t h e r , w i t h p a r t i c u l a r reference to c o n d i t i o n s both be f o r e and a f t e r the opening of the c a n a l , i t may be p o s s i b l e t o formulate concrete conclusions as to the r e a l and p o t e n t i a l e f f e c t of the canal upon Western Canadian t r a d e . From t h a t p o i n t , we s h a l l go on to explore the channels of i n t e r n a l t r a d e , t r a d i n g areas, and the more no t i c e a b l e f e a t u r e s o f " : (IV) Canadian centers of production. I n t u r n , i t i s proposed to analyze f r e i g h t r a t e s on Canadian r a i l w a y s , t h e i r r e a c t i o n to water competition; the development of B r i t i s h Columbia p o r t s ; new t r a v e l routes and s e r v i c e s opened up; and to analyze water-horne s h i p p i n g c o s t s , w i t h t h e i r r e l a -t i o n to f u e l c o s t s , bunkering f a c i l i t i e s , and the empty tonnage problem. F i n a l l y , we s h a l l observe these f a c t o r s as they are r e f l e c t e d more p a r t i c u l a r l y i n the wheat tra d e through Canadian P a c i f i c p o r t s . I n any study of " e s t e m Canada, i t must be borne i n mind that the Dominion i s not one compact economic u n i t . I t s t r e t c h e s over 5000 m i l e s of v a r y i n g s o i l and c l i m a t e , and, although the r a i l w a y s and waterways help to b r i n g a semblance of u n i t y , t h i s v a s t land i s d i v i d e d i n t o f i v e d i s t i n c t and separate areas. On the A t l a n t i c Coast, the Maritime P r o v i n c e s c o n s t i t u t e an area w e l l s u p p l i e d w i t h harbors, which, due to the temperate c l i m a t e , are open the year around. As a r e s u l t , a great deal of Canada's t r a d e , during the w i n t e r months, f i n d s i t s way to the A t l a n t i c seaboard and thence to the markets of the world. Economically, the Mar i t lines are, to a great extent, subordinate to the New England States to the south, and are i n f l u e n c e d a p p r e c i a b l y by American trade c o n d i t i o n s . The Canadian i n d u s t r i a l a r e a i s centered l a r g e l y i n Ontario and Quehec. Due to t h i s f a c t , i n l a r g e measure, we f i n d the g r e a t e s t p r o p o r t i o n of Canadian p o p u l a t i o n centered i n these provinces, and, for obvious reasons, the two l a r g e s t f i n a n c i a l c e n t e r s i n the Dominion, (18) Toronto and Montreal, are l o c a t e d here. Despite the f a c t that the St. Lawrence R i v e r i s closed to n a v i g a t i o n for f i v e months of the year, t h i s s e c t i o n c o n s t i t u t e s "by f a r the most important of the f i v e economic u n i t s . To the north of Lake Superior, i n Western Ontario, l i e s a vast, b a r r e n wasteland. The rugged nature of the t e r r a i n made i t one of the most d i f f i c u l t p a r t s of Canada through which to c o n s t r u c t the r a i l w a y system; for the same reason, very l i t t l e of r e a l economic a c t i v i t y o r i g i n a t e s h e r e i n . What i s commonly c a l l e d "the Granary of the Empire" i s s i t u a t e d i n the three P r a i r i e P rovinces - Manitoba, Saskatchewan, and A l b e r t a . H e r e i n l i e s the great wheat-producing area of Canada, and from these provinces flows the golden harvest which i s the mainspring of the Canadian economy. The f i f t h area comprises the province of B r i t i s h Columbia. Canada's P a c i f i c province i s e f f e c t i v e l y separated from the r e s t of the Dominion by the Rocky Mountains, I n many r e s p e c t s , i t resembles the Liaritime provinces i n the east; the c l i m a t e i s much the same, harbors are open the year round, and, to a great e x t e n t , i t i s economic-a l l y subordinate to the P a c i f i c Coast s t a t e s . I f we t r a c e the Rocky Mountain range r i g h t dov/n through the U n i t e d S t a t e s , we see that i t does not run p a r a l l e l to the coast, but - :j (19) on an angle, so that when i t reaches the southern P a c i f i c s t a t e s , a vast i n l a n d empire opens up from the mountains to the sea, Geographic-• a l l y , Alaska, B r i t i s h Columbia, Washington, Oregon, Idaho, Nevada, C a l i f o r n i a , Utah, and A r i z o n a are a u n i t i n themselves. I f i t were not f o r p o l i t i c a l houndaries, t h i s huge t e r r i t o r y would be bounded on the n o r t h by Alaska, on the east by t h e Rockies, on the west by the P a c i f i c Ocean, and on the south by Mexico, Consequently, i t i s q u i t e evident t h a t , while Western Canada must he s t u d i e d i n the l i g h t of i t s p o l i t i c a l and economic a s s o c i a t i o n wit h the r e s t of the Dominion, c o n s i d e r a t i o n should a l s o be g i v e n to the very c l o s e r e l a t i o n s h i p that e x i s t s w i t h the P a c i f i c Coast s t a t e s , I t would seem there are two important f a c t o r s i n Western Canadian economic h i s t o r y - the completion of the Canadian P a c i f i c Railway and the opening of the Panama Canal, The former changed Oanada* s western province from a p u r e l y P a c i f i c r e g i o n to an economic u n i t w i t h i n the Dominion; from an i s o l a t e d p o l i t i c a l appendage to an i n t e g r a l p a r t of t h i s v a s t country. We s h a l l f i n d that the Panama Canal we.3 the instrument f o r f u r t h e r economic i n t e g r a t i o n , supplementary to simple p o l i t i c a l a f f i l i a t i o n , and, as such, has been one of the most momentous developments i n the Twentieth Century. (20) CHAPTER V An a n a l y s i s o f the e x t e r n a l t r a d e of Canada, and, more p a r t i c u l a r l y , o f the e x t e r n a l t r a d e of the four western provinces, f o r the f i r s t 37 years of the Twentieth Century, presents i n i t s e l f a formidable problem, I t i s one worthy of a great deal of research and study, and i t could w e l l be extended to encompass s e v e r a l volumes. I t i s not the purpose of t h i s work to attempt a comprehensive economic h i s t o r y of the p e r i o d , but an e f f o r t w i l l be made to observe the dominant c h a r a c t e r i s t i c s of Canadian tra.de d u r i n g the years 1900-= 1937. I t i s hoped, i n such a study, to d i s c o v e r some of the b a s i c economic tr e n d s , and f i n a l l y to attempt to designate (bearing i n mind the forces at work, as mentioned i n a preceding chapter) what i n f l u e n c e a new sea route to Europe had on the economy of the western provinces. For the student o f economic h i s t o r y , t h e r e i s a v a i l a b l e a v/ealth of raw m a t e r i a l , p a r t i c u l a r l y covering the p e r i o d from 1900 on. Of t h i s m a t e r i a l , perhaps the most valuable appears i n the group of p u b l i c a t i o n s put out by the Dominion Bureau of S t a t i s t i c s , I n a d d i t i o n , there are the s e s s i o n a l papers, p r o v i n c i a l and Dominion government . r e p o r t s , and a host of short s t u d i e s on p a r t i c u l a r phases of Canadian economic l i f e . On the other hand, one i s confronted by a f i e l d of study which, so f a r , has not been covered i n one comprehensive economic h i s t o r y . Consequently, any student doing work on one p a r t i c u l a r aspect of Canadian economic problems must g i v e , as b r i e f l y as p o s s i b l e , a general h i s t o r y of the whole to which he can r e l a t e h i s p a r t i c u l a r ' 1 (21) d i s c o v e r i e s and conclusions. From the point of view of time, the p e r i o d d i v i d e s i t s e l f r e a d i l y i n t o four d i s t i n c t p a r t s . For convenience' sake, they may he c l a s s i f i e d ass ( l ) The E r a of Expansion, 1900-1914; (2) The Great V/ar, 1914-1920; (3) The Post-War P e r i o d , 1921-1929; and (4) The Great Depression, 1930-1937. The l a s t c l a s s i f i c a t i o n may not he s t r i c t l y c o r r e c t , because i t i s g e n e r a l l y considered that the Depression l a s t e d from 1930 to 1935, and t h a t , from 1935 on, world economic c o n d i t i o n s were on the up-swing again. However, there seems l i t t l e v alue i n ma-king a f i f t h c l a s s i f i c a t i o n comprising the two years, 1936 and 1937. I n a d d i t i o n , the o p i n i o n i s held i n c e r t a i n quarters that even yet we are not out of the Depression. Consequently, i t would seem most convenient t o consider the l a s t seven years together. I t w i l l be noted that i n the l a s t 37 y e a r s , there have been two "Great" economic phenomena - the Great War and the Great Depression. This p r e f i x may w e l l be i n t e r p r e t e d as something extremely abnormal, and, t h e r e -f o r e , from the p o i n t of view o f the economist i n search of b a s i c trends, they must be t r e a t e d with the g r e a t e s t respect and c a u t i o n . I n other words, f o r a l l p r a c t i c a l purposes, out of the 37 years under ob s e r v a t i o n , a t l e a s t 15 are extremely abnormal. I t i s g e n e r a l l y agreed that the year 1900 was the t u r n i n g p o i n t i n Canadian economic h i s t o r y . I t marked the b e g i n n i n g of a new e r a of expansion and development, unprecedented i n the h i s t o r y of (22) the country. For example, i n the decade 1901-1911, p o p u l a t i o n increased over 35%, the highest increase r e g i s t e r e d i n any country i n t h e world at that t i m e . John Buchan, now Lord Tweedsmuir, and at present Governor-General of Canada, s a i d of the p e r i o d , "Immigrants poured i n from Great B r i t a i n alone at the r a t e o f from one t o two hundred thousand a year, n e a r l y a l l to the North-West ....... A l l over England and Scotland,, men t a l k e d Canada, and Canadian investments he came eag e r l y sought a f t e r . Immigration s o c i e t i e s worked w i t h unprecedented energy. Pamphlets showered l i k e autumn leaves over the B r i t i s h I s l a n d s , and, every newspaper sent out s p e c i a l correspondents I n much l e s s c o l o r f u l f a s h i o n , the t a b l e f o l l o w i n g (Table 4) g i v e s the st o r y o f t h i s great development: TABLE 4. POPULATION GROWTH. (ooo's omitted) 1901 1906 1911 1916 1921 1926 1931 1936 B r i t i s h Columbia 178 279 392 456 524 606 694 750 A l b e r t a 73 185 374 496 588 608 731 772 Saskatchewan 91 258 49 2 648 757 821 921 9 <3 X Manitoba 255 366 461 554 610 639 700 711 T o t a l Western. Canada 598 1088 1720 2154 2480 2674 3047 3164 Canada 557 X 6097 7206 8001 8788 9451 10376 11028 Ontario * 2182 2299 2572 .2713 39 35 3164 3431 3690 ( T o r Comparison) Sources Canada Tear Book 1937, p. xxx 1. Buchan", John. The Natl"ons~"of" To-day. B r i t i s h America. Boston'& New" York, 1923, p.130. * :> (23) F i g u r e s 1 and 2, on Pages 24 and 25, show the r e l a t i v e changes as expressed i n Tahle 4. The t o t a l p o p u l a t i o n of Canada "increased from 5,371,000 i n 1901, to 7,500,000 I n 1914, an i n c r e a s e , as p r e v i o u s l y mentioned, of 35%. This l a t t e r f i g u r e , however, r a t h e r understates the p o s i t i o n i n 1914. The Dominion f i g u r e s are only given f o r 1911 and 1916, and i n 1916 the po p u l a t i o n was over 8,000,000. Since the g r e a t e r part of the p o p u l a t i o n increase took place before the outbreak of the war, i t i s not unreasonable t o assume that i n 1914 the f i g u r e was very close to 8,000,000, which i s an increase of over 50% i n 13 years. C o n s i d e r i n g the four western provinces, we f i n d a much great e r p r o p o r t i o n a l increase than the general increase f o r a l l of Canada. I n 1901, the t o t a l p o p u l a t i o n of Western Canada was only 598,000, whereas i n 1914 i t was over 2 m i l l i o n , an increase of over 225%. TABLE 5 POPULATION (000's omitted) 1901 1914 Percentage Increase B r i t i s h Columhla Alb e r t a ,., Saskat chew an , „ Manitoh a »..».•«..*••»•«.••«•.»,.,».» 175 73 90 25 5 4L25 435 575 515 145% 500% 520% 100% Ontarxo 2180 2600 20% (24) FIGURE 1 GAMBIA! POPULATION- 1901-1956 Thousands 10,000 9,000 8,000 7,000 6,000 5,000 4,000 3,000 2,000 1,000 900 800 700 600 500 > / / / / / / / Legends / —f- Canada Ontario / / Western Canada 1901 1906 1911 1916 1921 1926 1931 1936 Source; Canada Year Book, 1957, pp.xxx, x x x i . (25) FIGURE 2 Thousands 1,000 900 800 700 600 WESTERN CANADA POPULATION - 1901-1936 500 400 300 200 100 90 80 70 60 50 40 y — — /s s / y" / / / h / / / // / ' / 11 i / / / ' • . / / : / / / / / 4 • Legend s B r i t i s h Columbia — - — - — A l b e r t a Saskatchewa Manitoba n 1901 1906 1911 1916 1921 1926 1931 1936 Sources Canada Tear Book, 1937, pp.xxx, x x x i . * i (26) . The foregoing t a b l e (Table 5) shows where the l a r g e p a r t of the 225%' increase took p l a c e . Saskatchewan, aid A l b e r t a head the l i s t , w i t h ' B r i t i s h Colombia and -*£fe-ea?4* r e l a t i v e l y much further behind. While the percentage i n c r e a s e i n Manitoba was l a r g e ( a c t u a l l y , over twice that for the whole Dominion), i t was not n e a r l y as pronounced as the two f i r s t mentioned provinces. Comparatively speaking, Ontario showed no outstanding advance at a l l f o r t h i s period. Thus, we see that the r e a l l y great development took place i n the f a r West, p a r t i c u l a r l y i n those two provinces, which, up t o that time, had had very l i t t l e a t t e n t i o n . The f a c t o r s r e s p o n s i b l e f o r t h i s g r e a t development were manifold. I n the words of Alexander Brady, "The progress of the country has been i n f l u e n c e d at every t u r n by the agencies of world economics, and e s p e c i a l l y was the settlement of the West promoted by the f a c t t h a t a f t e r 1900, f o r e i g n c a p i t a l , p r i n c i p a l l y B r i t i s h and American, found 2 i t s way i n t o Canada i n i n c r e a s i n g q u a n t i t i e s . " Such f o r e i g n investments, supplemented by l a r g e governmental expenditures, both f e d e r a l and p r o v i n c i a l , b u i l t branch r a i l w a y s , new t r a n s c o n t i n e n t a l l i n e s , m i l l i n g p l a n t s , e l e v a t o r s , and f a c t o r i e s , thus adding to Canada's c a p i t a l equip-ment by m i l l i o n s each year. The r a i l w a y s opened up the i n t e r i o r of the country, and brought w i t h i n easy reach of world markets the produce of the f e r t i l e p l a i n s of A l b e r t a , Saskatchewan, and Manitoba. At the same time, p r i c e s were r i s i n g , thus ass u r i n g the farmer a good r e t u r n on h i s l a b o r and the c a p i t a l that he had i n v e s t e d , and the world market f o r 2, Brady, Alexander. Canada, London, 1952, 151. (27) • wheat and. other a g r i c u l t u r a l products was r a p i d l y expand!ng. F i n a l l y , a f a c t o r of great importance appeared when the supply of free land i n the U n i t e d States r a n out, This was the s i g n a l f o r a l a r g e i n f l u x of t r a i n e d American farmers i n search of new o p p o r t u n i t i e s i n A l b e r t a and Saskatchewan, I n the 15 years from 1901 to 1916, emigration from the United States to Canada amounted t o : 1901 - 17,987 1906 - 52,796 1911 - 112,028 1916 - 41,797 5 These people came to Canada seeking new o p p o r t u n i t i e s , and they were w e l l r e p a i d i n b o u n t i f u l harvests reaped i n the years which f o l l o w e d . I t would seem that f o r a s h o r t w h i l e , at l e a s t , Canada d i s p l a c e d the U n i t e d S t a t e s as "the land of promise". P r e v i o u s l y , the development of the steam r a i l w a y was c i t e d as one of the causes of the great expansion of t h i s p eriod. Table 6, on Page 28 , wi 11 demonstrate more c l e a r l y t h i s development. I t shows the t o t a l steam r a i l w a y mileage i n Canada from 1900 to 1914, and i n the provinces from 1907 to 1914. U n f o r t u n a t e l y , s t a t i s t i c s are not a v a i l -able f o r the r a i l w a y mileage by provinces p r i o r to 1907. While these mileage f i g u r e s do not show as great a c t u a l ' g a i n s as the p o p u l a t i o n f i g u r e s , t h ere i s an evident r e l a t i o n s h i p , and the trends seem to be up i n much the same pl a c e s . The t o t a l r a i l w a y mileage of Canada rose 3, Canada Year Book, 1937. p.xxx. (28) TABLE 6 CANADIAN STEAM RAILWAY MILEAGE - 1900-1914 YEAR MANITOBA SASKATCHEWAN ALBERTA BRITISH COLUMBIA CANADA ONTiffiK 1900 - _ 17,657 1901 - - - 18,140 1902 _ - - - 18,714 190S - - _ 18,988 _ 1904 - _ 19,431 1905 - - - 20,467 — 1906 - 21,353 190? 3,074 2,025 • 1,323 _ 1,686 22,452 7,638 1908 3,111 2,081 1,323 1,753 22,966 7,925 1909 3,205 2,631 ' 1,322 .' 1,796 24.104 8 y229 1910 3,221 2,932 1,488 1,832 24,731 8,250 1911 3,466 3,121 1,494 1,842 25,400 8,322 1912 3,520 3,754 1,897 1,855 26,72? 8,546 1913 3,993 4, 651 2,212 1,951 29,304 9,000 IS 14 4,076 5,089 2,545 1,978 30,795 9,255 %age Inc., 1907-1914 30% 150% 95% 18% 40% 21% Source; Canada Year Book, 1914 , p.471-2. . >, (29) from 17,657 m i l e s i n 1900 to 30,795 m i l e s i n 19.14, an increase of about 75%. The mileage i n 1914 f o r Canada was 30,795 m i l e s , as against 22,452 miles i n 1907, an increase of about 40% - no small item i n such, a short p e r i o d . The p r o v i n c i a l f i g u r e s show where the major part of t h i s expansion took place. Saskatchewan had the g r e a t e s t increase w i t h 150%, A l b e r t a next w i t h 95%, Manitoba 30%, and B r i t i s h Columbia was a poor f o u r t h w i t h 18%. I t i s q u i t e obvious,, of course, t h a t the very • nature of the B r i t i s h Columbia t e r r a i n precluded any great mileage expansion, and i t w i l l a l s o be remembered that B r i t i s h Columbia and Manitoba were f a r outclassed by the two c e n t r a l western provinces i n p o p u l a t i o n growth. Again, Ontario serves as a splendid i l l u s t r a t i o n of the d i f f e r e n c e i n expansion between the east and the west. At t h i s p o i n t , i t may be most expedient to see, i n one p i c t u r e , as i t were, Canadian e x t e r n a l trade development. Table 7, on Page 30, g i v e s the value i n d o l l a r s of Canadian exports and imports each year from 1900 to 1936. Figure 3, on Page 31, i s the same in f o r m a t i o n i l l u s t r a t e d g r a p h i c a l l y . The two g i v e t h i s p i c t u r e i n as few words as p o s s i b l e . For convenience* sake, the four periods have been marked o f f i n r e d ; ( l ) The Bra of Expansion, 1900-1914; (2) The Great War, 1914-1920| (3) The Post-War P e r i o d , 1920-1929; and (4) The Great Depression, 1930-1937. The f i r s t period, as the graph shows very c l e a r l y , was an era of expansion. Except for the f i r s t t h r ee years, imports exceeded exports every year from 1900 to 1914. T h i s , of course, was due to the large (33) TABLE 7 C A N A D I A N I M P O R T S MB E X P O R T S - 1900-1936 (000'g omitted) — — — Y E A R I M P O R T S E X P O R T S Y E A R I M P O R T S E X P O R T S 1900 #172,651 #183,25? 1920 #1,064,528 $1,286,658 1901 177,930 194,509 1921 1,240,158 1,210,428 1902 196,737 209,970 1922 747,804 753,927 1903 225,094 225,229 192 5 802,579 945,295 1904 243,909 211,055 1924 893,366 1,058,763 1905 251,964 201,472 1925 796,932 1,081,361 1906 283,740 246,657 1926 . 927,328 1,355,912 1907* 250,225 192,087 1927 1,030,892 1,269.584 1908 352,540 265,368 1928 1,108,956 1,256,152 1909 288,594 259,922 1929 1,265,679 1,593,445 1910 370,518 298,763 1930 1,248,273 1,144,938 1911 452,724 290,000 1931 906,612 817,028 1912 522,404 307,716 195 2 578,503 611,253 1913 671,207 577,068 1953 406,385 534,978 1914 619,195 455,437 1934 435,798 672,265 1915 455,955 461,442 1955 522,431 764,284 1916 508,201 779,500 1956 552,719 862,472 1917 846,450 1 ,179,211 1918 965,552 1 ,586,169 1919 919,711 1 ,268,765 *1907 - Nine months only. Sources Canada Year Book, 1957, p.524. i (32) volume of c a p i t a l f l o v i n g i n t o the country, together v/ith the other f a c t o r s p r e v i o u s l y mentioned. While the exports increased r a p i d l y between 1900 and 1914, from 183 m i l l i o n to 455 m i l l i o n , or approximately 150%, imports expanded even more n o t i c e a b l y , from 172 m i l l i o n i n 1900 t o 619 m i l l i o n I n 1914, an i n c r e a s e of over 280%, At the peak year, 1913, imports exceeded exports by $363,491,000j t h a t i s to say, the value of imports was more than t w i c e as great as that of exports. At t h i s time, development was a t i t s height, and c a p i t a l was pouring i n t o the country a t a great r a t e . The second p e r i o d saw a r e v e r s a l of the t r a d e balance, and by 1915, imports and exports were p r a c t i c a l l y equal. I t w i l l be n o t i c e d here t h a t while imports decreased, exports continued t o i n c r e a s e . Frop 1915 on, both showed a sharp g a i n , u n t i l i n 1918 exports reached a new high point of $1,586,169,000, which exceeded imports by (5622,637,000, or n e a r l y 65%. Of course, i t must be remembered that at t h i s time, there was a considerable discrepancy between the d o l l a r value of imports and exports and t h e i r ' a c t u a l volume. This was due to the extensive i n f l a t i o n which took p l a c e during the war. I n view of the f a c t t h a t such a p e r i o d of abnormality wi11 throw l i t t l e l i g h t on the main purpose of our i n v e s t i g a t i o n , i t i s h a r d l y necessary to d e f l a t e these values to a comparative s c a l e . I t i s s u f f i c i e n t to say t h a t the war period i s much too abnormal t o show any e f f e c t s of the Panama Canal e i t h e r on Canadian trade as a whole or that of Western Canada. To continue w i t h the t h i r d phase, we f i n d t h a t exports s t i l l (53) exceeded imports during t h i s p e r i o d . This was due to several f a c t o r s , c h i e f among them being i n t e r e s t payments on debts, good wheat crops ( p a r t i c u l a r l y from 1925 on), and a shrinkage i n the amount of f o r e i g n c a p i t a l a v a i l a b l e f o r investment. I t w i l l he n oticed that from 1925 on, the value of imports g r a d u a l l y began to approximate that of exports, which would seem to i n d i c a t e , among other t h i n g s , t h a t , w i t h r e t u r n i n g good times, investments i n Canada were on the up-grade. S h o r t l y a f t e r the c l o s e of the War, i n 1922, there was a sharp depression i n a l l t r a d e , hut from t h a t time on, up t o 1929, Canadian trade showed a marked up-swing. I t i s he Id by some economists that Canada, hut f o r the World War, would have continued t o import more than she exported f o r a t l e a s t the f i r s t 50 years of the Twentieth Century. Whether t h i s he t r u e or not, i t i s c e r t a i n that the war d i d do a great d e a l to change both t h i s country and the United States from great importing c o u n t r i e s to great exporters. As f a r as Canada was concerned, however, wheat was another important f a c t o r i n t h i s development, and i t i s altogether d o u b t f u l that the Dominion would have maintained her balance of imports i n excess of exports f o r anything l i k e 50 years. Prom 1900 to 1914, the country's exportable s u r p l u s of wheat was not very l a r g e ; from 1920 on, t h i s surplus grew year by year, and, as i t grew, Canada came to depend more and more on the world wheat market as a source of p r o s p e r i t y . To quote the authors of the Canada Tear Book, "Exports represent the sale i n world markets of surplus products of Canadian farms, mines, * (34) f o r e s t s , f i s h e r i e s , and f a c t o r i e s , and, when there i s a ready sale for such products at p r i c e s p r o f i t a b l e to the producer, l a r g e exports 4 • r e s u l t i n p r o s p e r i t y i n Canada." The t r a n s f o r m a t i o n of Canada from a country l a r g e l y dependent upon imports for i t s p r o s p e r i t y , as wss the case up t o 1914, t o one depending on exports,, i s best i l l u s t r a t e d by the change i n type of commodities making up the l a r g e r part of Canadian trade. Table 8, on Pages 35 and 36, shows the ten most important Canadian imports and exports by value i n the years 1900, 1910, 1920, 1930, and 1936, A cl o s e study of t h i s t a b l e b r ings out some very i n t e r e s t i n g f a c t s . C o n s i dering the imports, what do we f i n d ? F i r s t o f a l l , the inward movement of Cane.dian trade was much more d i v e r s i f i e d than t h a t outward. As may be seen from the t a b l e , the t e n most valuable commodi-t i e s only make up s l i g h t l y under 40% of the t o t a l imports. This r a t i o has been q u i t e constant since the tu r n of the century, and i t would seem t h a t , on the whole, Canada buys a f a i r l y wide range of commodities. Boring the 56-year p e r i o d , t h e r e l a t i v e importance of the v a r i o u s commodities bought has changed a great d e a l . Foel has always been an important p a r t of Canadian imports - c o a l up to 1930, and crude petroleum and c o a l i n 1936. I n 1910, s e t t l e r s ' e f f e c t s amounted to over t e n m i l l i o n d o l l a r s , and ranked seventh on the l i s t ; at no other time did t h i s item a t t a i n such Importance. Among the c o n s i s t e n t l y high commodities are r o l l i n g m i l l products, c o t t o n and woollen goods, sugar end i t s 4, Canada Year Book, 1937, p.505. (35) TABLE 8 TEN LEADING CANADIAN IMPORTS AND EXPORTS. 1900 - 1936. IMPORTS VALUE OF * TOTAL EXPORTS ~ : %AGE VALUE OF * TOTAL 1900 Rolling- M i l l Products Coal Woollen Goods Sugar and Products G r a i n and Products Cotton Goods ' Raw Hides & Skins S i l k Goods Wood (unmanufactured) Tea T o t a l T o t a l Canadian Imports 1910 Coal Woollen Goods Cotton Goods R o l l i n g M i l l Products Sugar and Products Machinery (except farm) S e t t l e r s ' E f f e c t s Raw C ot t on F r u i t s Wood (unmanufactured) T o t a l • T o t a l Canadian Imports 1980 Sugar and Products Goal. Cotton Goods Woollen Goods R o l l i n g M i l l Products Machinery (except farm) Raw Cotton F r u i t s S i l k Goods Hides & Skin s T o t a l T o t a l Canadian Imports * Value - M i l l i o n s of Do 27.5 20.8 17,9 15* 7 15.0 14.7 10.3 9 «» 4 8.3 8 . 3 147.9 370.3 73,6 60,1 4-9.1 45,4 40.0 36,7 3*D# 9 35,5 31»3 i2S • 7 42674 064,5 5% 5% 4% 4% 4% 3% 3% 2% 59% 100%. I/O pfiT O/o rip/ O/o 3% 1 l i a r s 3%~ 3% _J2% 39% 100% 1900 Planks and Boards Cheese Gold (Raw) Meats Wheat F i s h C a t t l e B u t t e r Goal F r u i t s ( c h i e f l y apples) Total' T o t a l Canadian Exports 1910 Wheat Planks & Boards Cheese F i s h S i l v e r Ore Wheat F l o u r G a t t l e • Meats Wood Pulp Copper Ore & B l i s t e r T o t a l T o t a l Canadian Exports 1920 Wheat Meats Wheat Flour Planks & Boards Newsprint & Paper C a t t l e Wood Pulp F i s h Cheese Sugar and Products Tot a l T o t a l Canadian Exports 22,0 19 ^  9 14.1 13.6 12.0 10.6 8.7 4.6 3 » 3 113.9 183.2 52.6 33,1 21.6 15.2 15.0 14.9 10.8 8,0 6.0 6.0 183.2 298,8 185,0 96,2 94.5 75,2 53,6 46,1 41,4 40.7 36,3 30 .7 699.5 ,286,7 12% 11%' 8%" 7% 7% 6%'-5% 3%" 5% _2 % 64% 100% 18% 11%' 7% 5% 5%" 5% 100$ 14%" 7% 7% S% • 4% 4% 3% 3/ %> 3% 2% 53% of 100* (36) TABLE 8, CONED. jg N JgADING CANADIAN nTOWSSJ^_2^(WPS, 1900-1936 IMPORTS "%AG2 VALUE OP * TOTAL EXPORTS 1930 Machinery (except farm) R o l l i n g M i l l Products Goal Crude Petroleum A l c o h o l i c Beverages E l e c t r i c Apparatus Auto P a r t s • Automobiles F r u i t s Woollen Goods T o t a l T o t a l Canadian Imports 19-36 Crude Petroleum Coal R o l l i n g M i l Products Auto P a r t s Machinery (except farm) F r u i t s Sugar and Products Raw Cotton Cotton Goods Vegetable O i l s T o t a l T o t a l Canadian Imports 6% 5% 4$ 4% 4% 3% 3% 3% 3% Zfo 1248,3 100% 1930 Whe at Newsprint Planks & Boards Wheat F l o u r Wood Pulp Copper Ore & B l i s t e r Automobiles F i s h Gold (Raw) Whi skey T o t a l T o t a l Canadian Exports 19 35 35. 6 6% Wheat 3s3 ® 8 6% Newsprint 24*8 4% Gold B u l l i o n 4% N i c k e l 21,9 4% Wood Pu l p 20.3 4% Planks & Boards JL9 ^  2 3% P i s h 17 a 2 Sfo Meats i s ® 0 3% Automobiles 12.1 2% Copper i n forms 220.6 • 39% T o t a l 562.7 100% T o t a l Canadian Exports VALUE %AGE OP TOTAL 18% 13% 4% 4% 4% 3% 3% 3% 3% _2% 57% 00% 148.6 17% 90,8 10% 83,4 9% 41.6 5% 28,1 3% 27.6 3% 24.4 3% 24. 2 3% 25»S 3% 23,7 3% 516,3 59% 862.5 100% * Value - M i l l i o n s of D o l l a r s , Sources Canada Year Book, 1937, p.515, • , (37) •by-products, machinery, and f r u i t s ; most of these represent common a r t i c l e s f o r consumption i n a young p i o n e e r i n g country. I n l a t e r • years, the growth I n importance of automobiles and automobile p a r t s has been most n o t i c e a b l e ; they appear i n the f i r s t ten imports i n 1930, ranking e i g h t h and seventh r e s p e c t i v e l y , w h i l e i n 1956, automobile p a r t s rank 4th. Automobiles do not appear i n the ranking i n 1956, due to the f a c t t h a t American manufacturers have e s t a b l i s h e d assembling p l a n t s i n Canada i n order to escape the high d u t i e s on imported cars. Turning to the exports, we f i n d an e n t i r e l y different-s i t u a t i o n . I n each of the f i v e years under c o n s i d e r a t i o n , the t e n highest commodity values have c o n s t i t u t e d at l e a s t 55% of the t o t a l exports, and as high as 64% i n 1S00. As i n the case of imports, there has he en some considerable change i n the r e l a t i v e importance of the various commodities. I n four years out of f i v e , wheat has headed the l i s t , as the most important Canadian export. I f the value of f l o u r exports i s included, we f i n d t hat the two together const i t u t e 25% of the exports i n 1910, 21% i n 1920, 22% i n 1930, and 19% i n 1956, As time goes on, we see t h i s one product m a i n t a i n i n g a very important place i n Canadian t r a d e . In the l a t e r years of the p e r i o d , n o t i c e a b l y from 1930 on, newsprint and wood pulp have increased i n importance, and we f i n d the two, wheat and i t s by-products and wood pulp and i t s by-products, combine to make up 28% of the Canadian exports i n 1920, 59% i n 1950, and 32% i n 1936, This "brings us to a very i n t e r e s t i n g comparison between * i (38) imports and exports. In 1920, the f i r s t t e n imports c o n s t i t u t e d 39% of the t o t a l of a l l imports, w h i l e only two of the exports made •up over 28% of the t o t a l of a l l exports. Comparing the a c t u a l values, we f i n d the t e n imports t o t a l l e d 426.4 m i l l i o n d o l l a r s , w h i l e wheat and wood pulp, i n c l u d i n g f l o u r and newsprint, amounted to 374.3 m i l l i o n d o l l a r s . Again, i n 1950 and 1956, the s i t u a t i o n was much the same. I n 1930, t e n imports c o n s t i t u t e d 58% o f the t o t a l imports, while the two exports mentioned above made up 39% o f the t o t a l exports. A c t u a l l y , two commodities c o n s t i t u t e d a g r e a t e r percentage of the t o t a l exports than did ten commodities of the t o t a l imports. I n d o l l a r values, t h e former amounted to 451.6 m i l l i o n , and the l a t t e r 459.2 m i l l i o n ? the two were p r a c t i c a l l y equal i n value. I n 1936, these two exports had a d o l l a r value o f 283.9 m i l l i o n , as a g a i n s t 220,6 m i l l i o n f o r the t e n c i t e d l e a d i n g imports. Our t o t a l exports of wheat and wood pulp products a c t u a l l y exceeded the sam of the t e n l a r g e s t imports by over 60 m i l l i o n s of d o l l a r s ; i n f a c t , the value of these two exports was 54% of the t o t a l value of a l l products imported Into Canada i n 1936, One f i n a l comparison between exports and imports w i l l throw some fu r t h e r l i g h t on the subject. I n 1920, the t o t a l value of the ten l e a d i n g exports from Canada was 699»5 m i l l i o n s of d o l l a r s , which was 65% of the t o t a l of a l l imports i n t o the country. I n 1930, the value of the former was almost unchanged at 669.4 m i l l i o n s of d o l l a r s , but was only 55%" of the t o t a l of a l l imports. I n 1936, i t was lower. ' >. (39) at 516.3 m i l l i o n s of d o l l a r s , but equalled 95%" of the t o t a l of a l l imports into Canada. From the foregoing, we f i n d s e v e r a l important f a c t s . Since 1920, Canada has depended more and more on her a b i l i t y to s e l l i n world markets one or two primary products, the produce of the f i e l d and f o r e s t . Her p o s i t i o n a f t e r that date changed from that o f a country r e l y i n g l a r g e l y on f o r e i g n c a p i t a l f o r investment, to one depending on f o r e i g n buying power as a source of p r o s p e r i t y . Con-sequently, anything which a f f e c t s Hie a b i l i t y of the other nations of the world to buy these primary commodities r e f l e c t s f8.vora.bly or unfavorably on the smooth f u n c t i o n i n g of the Canadian economic machine. I t i s r e f l e c t e d i n high or low wages. I n a high or low standard of l i v i n g , i n an unemployment problem or work for the Canadian people. I t s impact i s f e l t i n i n d u s t r y , i n a g r i c u l t u r e , i n mining, . and i n finance, Thus, we may draw the broad c o n c l u s i o n that any development which f a c i l i t a t e s the d i s t r i b u t i o n of Canadian products i s of value to the economic w e l l - b e i n g of the country as a whole. We s h a l l see, as we progress, t h a t the Panama Canal was a very potent f a c t o r i n the development of the Canadian t r a n s p o r t a t i o n system, and, as such 3 improved Canada* s p o s i t i o n i n the world market i n c e r t a i n d e f i n i t e resp e c t s . Before g o i n g on t o study the trade of Western Ca.na.da i n d e t a i l , i t might be as w e l l to review two more f a c t o r s i n the general trade of the Dominion as a whole. These are, f i r s t , the o r i g i n of • • (40) our imports and the d e s t i n a t i o n . o f our exports, and, second, the trade agreements between t h i s country and other n a t i o n s , Canadian trade w i t h the United States can be s a i d to be that l e a s t a f f e c t e d by such development as the opening of the Panama Canal, \Vhile i t i s undoubtedly t r u e that there i s trade between the east coast of the United States and the west coast of Canada, i t i s impossible to f i n d out just what the volume i s , and for our purposes i t i s comparatively safe a r b i t r a r i l y to e l i m i n a t e a l l United States trade w i t h Canada, At l e a s t , i n so doing, we s h a l l see the r e l a t i v e importance of our overseas trade i n r e l a t i o n to our t r a d e w i t h the U n i t e d S t a t e s , Table 9, on Page 41, gives the percentage of Canadian exports which are destined for (a) the United States, and (b) Other Foreign Countries; also the percentage of Canadian imports which o r i g i n a t e i n (a) the United S t a t e s , and (b) Other Foreign Countries,. •Figure 4, on Page 42, i l l u s t r a t e s the p r o p o r t i o n of Canadian exports which go to the United States and to other c o u n t r i e s . Figure 5, on Page 43, shows the percentage of imports from the Un i t e d States and from other c o u n t r i e s . These two i l l u s t r a t i o n s f u r t h e r serve to i n d i c a t e the r e l a t i v e importance to Canada of her exports to overseas c o u n t r i e s . While the United States i s a good customer, and buys from 25% to 40% of our exports annually, Canada buys a much l a r g e r r e l a t i v e p r o p o r t i o n o f her imports from the U n i t e d S t a t e s ; i n other words, from the (41) TABLE 9 THE PERCENTAGE OF CANADIAN EXPORTS AND IMPORTS TO AND FROM COUNTRIES OTHER THAN THE UNITED STATES. YEAR EXPORTS IMPORTS YEAR EXPORTS 1W0W 1900 66% 41% 1920 63% 25% 1901 62 . 40 1921 54 31 1902 66 42 19 22 60 51 1903 69 43 1925 60 33 1904 67 41 1924 59 55 1905 63 59 1925 61 36 1906 64 40 1926 64 S3 1907 66 40 1927 63 35 1908 63 42 1928 61 35 1909 65 41 1929 65 31 1910 63 41 1950 54 32 1911 62 39 1951 56 35 1912 65 57 1932 57 39 1913 61 55 19 3 3 63 43 1914 62 56 1934 67 45 1 9 10 - 58 35 1955 60 42 1916 73 27 1936 58 45 191? 76 21 1918 75 18 1919 63 18 Source: Canada Year Book, 19 37 f, « 529. , (42) in to in tO <# co to e CQ co •W C M i—i to « EH r-i to C O o o to 9i P C M w EH 0 3 O C M c-O fe <o C M fl in s C M C M ' « to C M m '61 E H C M rH o C M fe 0 3 E H C O r-i o Bi CO r-H £>-s to S3 m r-H O <# fe r-i o to .-1 < M E H r-( H '•H O o cn O CO o i t o to o in •o m o (§ to c5 o fe C M o t—i o o. (43) 0'<s'< o> O / m u \ E H co w F H \ l-H 'id in fe C O / V s / / — 1 M fl o / \ \ / 1 / \ \ co m 8 o C M m « to © cr> O O S3 o .d fl -p fH o aS S CD si •rH !25 3 I CO o !>-O cn CD i—! o fH o C O o as o CO o o o m 8 ' 1 (44) s t a n d p o i n t of i m p o r t s , o t h e r c o u n t r i e s s u p p l y us w i t h a r e l a t i v e l y s m a l l p r o p o r t i o n - d u r i n g the war, f o r o b v i o u s r e a s o n s , they s u p p l i e d o n l y 18/o o f ov.r t o t a l p u r c h a s e s , and the most they have s u p p l i e d i n any y e a r has b e e n 45%. On t h e o t h e r hand, o v e r s e a s c o u n t r i e s t a k e from u s a v e r y l a r g e p r o p o r t i o n of our t o t a l s a l e s i n f o r e i g n m a r k e t s ; t h u s , t h e a b i l i t y t o market such goods becomes an e v e r more i m p o r t a n t f u n c t i o n o f o u r economic system. A g e n e r a l a n a l y s i s of Canadian t r a d e would not be c o m p lete w i t h o u t a b r i e f r e f e r e n c e t o t a r i f f r e l a t i o n s h i p s w i t h o t h e r c o u n t r i e s F o r our p u r p o s e s , t h e s e agreements need o n l y he 'reviewed from 1907 t o the p r e s e n t t i m e ; t h e i r s i g n i f i c a n c e i n C a n a d i a n t r a d e , and t h e i r r e l a t i o n t o t h e t r a n s p o r t a t i o n system w i l l be d i s c u s s e d l a t e r . On A p r i l 12, 1907, t h e New Canadian Customs T a r i f f was adopted. I t r e v i s e d and b r o u g h t up t o d a t e e a r l i e r agreements w i t h t h e U n i t e d Kingdom and the B r i t i s h Empire, and, f o r t h e most p a r t , i s s t i l l i n o p e r a t i o n t o - d a y . T h i s new t a r i f f c o n t a i n e d t h r e e columns of d u t i e s - B r i t i s h p r e f e r e n t i a l , i n t e r m e d i a t e , and g e n e r a l - and i t m a i n t a i n e d the B r i t i s h p r e f e r e n c e t o " t h o s e p a r t s o f the Empire w h i c h 5 were a l r e a d y e n j o y i n g i t u n d e r p r e v i o u s measures". S i n c e 1907, i t has been e x t e n d e d , a t one t i m e or. a n o t h e r , u n t i l i t now a p p l i e s t o a l m o s t a l l p a r t s o f t h e Empire, i n c l u d i n g p r o t e c t o r a t e s , mandates, and s p h e r e s o f i n f l u e n c e . 5. Canada Year Book, 1957, p.487. * j (45) Independent of B r i t i s h p r e f e r e n t i a l agreements, an agreement was entered i n t o "between Canada and the B r i t i s h West Indies i n 1912, • This was broadened i n 1920 by a second agreement, and s t i l l f u r t h e r extended i n 1927, I t now i n c l u d e s Jamaica, T r i n i d a d , Barbados, Bahamas Leeward I s l a n d s , Windward I s l a n d s , Bermuda, B r i t i s h Guiana, and B r i t i s h Honduras, and has produced a very p r o f i t a b l e trade between Canada and those c o u n t r i e s . P r i o r t o the I m p e r i a l Conference i n 1932, the United Kingdom government granted preferences to Empire products " w i t h i n the l i m i t e d 6 scope of her t a r i f f at that time," This took place i n 1919, and c a r r i e d on u n t i l a new t r e a t y was entered i n t o between Cans.da and the Un i t e d Kingdom at the Conference i n 1932, This agreement "guaranteed as part of a l a r g e r scheme of r e c i p r o c a l preferences, that Canadian goods would he exempt for f i v e years from d u t i e s e s t a b l i s h e d by the , • 7 Import Duties Act of 1932," A new agreement was signed w i t h the U n i t e d Kingdom i n 1937, which i s now i n e f f e c t . I t maintains r e c i p r o c a l preferences and remains i n f o r c e u n t i l 1940 and t h e r e a f t e r u n t i 1 e i t h e r of the c o n t r a c t i n g p a r t i e s terminates i t by s i x months' n o t i c e , A trade agreement was entered into w i t h A u s t r a l i a i n 1925, and f u r t h e r enlarged i n 1931, L a t e r , i t was extended to i n c l u d e New Zealand, and from time to time modified. In 1932, the I r i s h Free State was accorded b e n e f i t s s i m i l a r to the lowest r a t e s f o r s i m i l a r products charged on the goods of any country. I n the same year, agreements were 6. Canada Year Book, 1937, p.487. 7, i b i d , , p,488. * \ (46) entered i n t o with. South A f r i c a and Southern Rhodesia, I n 1933. an agreement was concluded between t h i s country and France, and i n 1956, a most-favored-nation agreement was entered i n t o with Poland. "Under mutual most-favored-nation customs treatment, each c o n t r a c t i n g country accords t he goods of the other the lowest d u t i e s a p p l i e d to s i m i l a r 8 products of any f o r e i g n o r i g i n , u nless there are r e s e r v a t i o n s . " I n 1936, a l s o , an exchange of notes took p l a c e between Canada and B r a z i l , i n which the former granted intermediate t a r i f f r a t e s i n r e t u r n for the B r a z i l i a n minimum or lowest t a r i f f . T his c o n s t i t u t e s a b r i e f review of Canadian t a r i f f r e l a t i o n s w i t h other c o u n t r i e s from 1907 on, and w h i l e i t does not cover every agreement entered i n t o by our government, i t does g i v e most of the important t r e a t i e s , and those which are l i k e l y t o have most b e a r i n g on t h i s p a r t i c u l a r subject. Canadian r e l a t i o n s w i t h t h e United States have been purposely omitted, i n as much as t h e i r e f f e c t on Canadian trade and the Panama Canal problem i s r e l a t i v e l y s l i g h t . 8. Canada Year Book, 1937, p.494. (4?) CHAPTER 71 Hairing considered the general c h a r a c t e r i s t i c s of Canadian e x t e r n a l t r a d e , we may now pass on to t h e exports and imports of Western Canada, and of the four western provinces, The method of a n a l y s i s , i n t h i s case, i s somewhat simpler than that used i n studying Canadian t r a d e , i n t h a t the p e r i o d i s d i v i d e d i n t o two sections i n s t e a d of four - 1906 to 1920, and 1920 to 1936, I t i s necessary to take as the s t a r t i n g point the year 1906, because s t a t i s t i c s for the provinces are not a v a i l a b l e before t h a t time, While the Panama Canal was o f f i c i a l l y opened i n 1914. i t did not come in t o g r e a t use so f a r as Canada was concerned u n t i l 1920, due to causes already mentioned. Consequently, the year 1920 has been chosen as the d i v i d i n g l i n e to i l l u s t r a t e two periods i n the country's economic h i s t o r y - the one before the canal was opened, the other a f t e r . I n view of the f a c t that we are now d e a l i n g w i t h i n t e r n a l c o n d i t i o n s , i . e . , comparing pa r t of Canadian trade w i t h the whole, there i s l e s s need of a l l o w i n g f o r abnormal world c o n d i t i o n s , except i n so f a r as we must continue to keep those c o n d i t i o n s i n mind as p o s s i b l e modifying i n f l u e n c e s . I t i s assumed, t h e r e f o r e , that world c o n d i t i o n s which a f f e c t e d Ca.na.da as a whole i n f l u e n c e d Western Canada i n l i k e manner and to r e l a t i v e l y the same degree. Consequently, for our purposes, i t i s deemed q u i t e safe to compare the two - Canada and Western Canada - under an a r b i t r a r y d i v i s i o n * : (48) i n t o two p a r t s , 1906-1920 and 1920-1936, I n F i g u r e s 6 and 7, Pages 49 and 50, a r e shown i m p o r t s f o r Canada and W e s t e r n Canada,, r e s p e c t i v e l f o r t h e y e a r s 1906-1920, The l i n e o f t r e n d has "been c a l c u l a t e d f o r t h e s e two s e t s o f f i g u r e s , and i s s i g n i f i e d on t h e g r a p h s i n r e d , w h i l e the f i g u r e s i n r e d on t h e r i g h t hand columns show t h e p e r c e n t a g e i n c r e a s e s ( o r d e c r e a s e s ) i n v a l u e per y e a r , That I s t o s a y , C a n a d i a n i m p o r t s f r o m 1906 t o 1920 i n c r e a s e d 10,2% per annum, and ?/estern Canada i m p o r t s i n c r e a s e d at an average y e a r l y r a t e o f 9,6% d u r i n g the same p e r i o d . T h i s shows, of c o u r s e , a s l i g h t l y g r e a t e r t o t a l p er cent age i n c r e a s e , over the whole p e r i o d , f o r Canadian, i m p o r t s t h a n f o r W e s t e r n Canada i m p o r t s - t h e f o r m e r b e i n g 142.8% and t h e l a t t e r 134,4%, The two, however, shot? a marked s i m i l a r i t y i n some r e s p e c t s . B o t h were a f f e c t e d b y t h e l a r g e i n f l u x o f f o r e i g n c a p i t a l f r o m 1909 t o 1915, D u r i n g t h e l a t t e r p e r i o d . W e s t e r n Canada shows g r e a t e r d e v i a t i o n from t h e l i n e o f t r e n d t h a n Canada, a development n o t u n e x p e c t e d i n v i e w o f our p a s t o b s e r v a t i o n s . I t would seem t h a t e x t e r n a l c o n d i t i o n s a f f e c t i n g the two had much th e same e f f e c t , but t h a t , i n the c a s e o f W e s t e r n Canada, t h e e f f e c t was more pronounced. A g a i n , f o r t h e p e r i o d 1920-1956, Canadian and Western Cans.da i m p o r t s show s i m i l a r t e n d e n c i e s , I n F i g u r e s 8 and 9, Pages 51 and 52, t h e s e v a l u e s a r e p l o t t e d , t ogether w i t h t h e i r r e s p e c t i v e l i n e s o f t r e n d and t h e p e r c e n t a g e d e c r e a s e s per annum. The annual a v e r a g e d e c r e a s e s f o r the two a r e almost e q u a l - 4.5% and 4.7%, r e s p e c t i v e l y . The d e v i a t i o n s from t h e l i n e o f t r e n d f o r Western Canada a r e somewhat (49) (50) (51) «3 ( 5 2 ) c--(53) more pronounced than for Canada, e s p e c i a l l y during the boom period from 1925 to 1930, and the depression period from 1950 to 1934, Apparently, purchasing power, as expressed i n Western Canada imports, i s more s e n s i t i v e to world c o n d i t i o n s than Canadian purchasing power as a whole. I n a d d i t i o n , the more diversified'economy of the whole country responds more slowly and more evenly to e x t e r n a l c o n d i t i o n s , The purchasing po?jer of the people i n the West i s l a r g e l y decided by the p r a i r i e farmer's wheat crop and h i s a b i l i t y to s e l l i t at a p r o f i t i n world markets. I f a.good p r i c e i s paid f o r wheat, the farmer i s a good customer; i f not, t h i s p o s i t i o n i s immediately reversed. A comparison of Figure 9, Western Canada Imports, 1920-1936, Page 52, and F i g u r e 13, Western Canada Exports, 1920-1956, Page 57, w i l l serve best to i l l u s t r a t e t h i s p o i n t : l a r g e values of imports tend to r u n w i t h high values of exports. I n comparing the values of exports f o r Canada and Western Canada from 1906 to 1920, we f i n d a somewhat d i f f e r e n t s i t u a t i o n . These are i l l u s t r a t e d i n Figures 10 and 11, Pages 54 and 55. Canadian values show a g r e a t e r increa s e per annum than the West - 16,2% per annum as against 14,7% - and a g r e a t e r t o t a l percentage gain over the period -226.8% as against 205.8% This i s not a great d i f f e r e n c e over a p e r i o d of 14 years, but i n t h i s case the West does not show as great d e v i a t i o n s from the l i n e of trend as the whole Dominion. From 1910 to 1916, as may be seen i n Figure 10, Canadian export values were l e s s than the normal for an unbroken period of years. I n the same period, Western ( 5 4 ) (55) m fl (56) ' 1 (58) Canada shows a considerable drop in. 1911 and 1912, marked recovery i n 1915, and r e l a t i v e l y smaller d e v i a t i o n s i n 1914, 1915, and 1916, Western Canada exports did not increase as r a p i d l y as those of Canada, over the whole period, l a r g e l y because development r e q u i r e d so much of the w e s t e r n Canadian s u r p l u s c a p i t a l to be plowed back i n t o the economic system., During the war, both recorded s u b s t a n t i a l increases i n exports, although here, again, the t o t a l values f o r the whole country show much the l a r g e r i n c r e a s e . I n the case of exports, Canadian values deviate from the average to a g r e a t e r extent during t h i s p e r i o d than those of the West I t w i l l be remembered that i n the case of imports, the p o s i t i o n was e x a c t l y r e versed, F i g u r e s 12 and 13, Pages 56 and 57, depict g r a p h i c a l l y Canadian and Western Canadian exports r e s p e c t i v e l y , for the years 1920-1936. A comparison of these two- diagrams b r i n g s out a very i n t e r e s t i n g f a c t , Canadian exports f o r the period show an average annual d e c l i n e of 3,2%, w h i l e Western exports show an increase of 1.1%. Over the whole p e r i o d , the former decreased 51,2%, -while the l a t t e r i n -creased 17.6%. From 1922 (when conditions reached depression propor-t i o n s ) to 1929, exports for both Canada and Western Canada increased very r a p i d l y , due, as we have seen, to improved world markets, p a r t i c u l a r l y for wheat and a g r i c u l t u r a l products. Both diagrams show a considerable r e c e s s i o n from 1930 to 1955, and a moderate increase i n the l a s t three years. However,. Western Canada shows a marked i n c r e a s e o v e r t h e whole p e r i o d , and we s h a l l a t t e m p t t o d i s c o v e r j u s t what caused t h i s improvement, and a l s o what r e a s o n s can he g i v e n f o r t h e i n c r e a s e i n t h e l a t t e r ' s e x p o r t v a l u e s , w h i l e the v a l u e s o f C a n a d i a n e x p o r t s were on the down-grade. Up t o t h i s p o i n t , we have c o n s i d e r e d C a n a d i a n c o n d i t i o n s a s a whole, and v e r y l i t t l e a t t e n t i o n has heen d e v o t e d t o the Panama C a n a l , W h i l e c e r t a i n v e r y g e n e r a l c o n c l u s i o n s m ight he drawn as t o t h e e f f e c t o f t h i s waierway on t h e c o u n t r y , t h e i r v a l u e f r o m a s c i e n t i f i c s t a n d p o i n t w o u l d h e n e g l i g i b l e . We may now go on t o s t u d y i n more d e t a i l t h e t r e n d s of t r a d e i n t h e f o u r w e s t e r n p r o v i n c e s . As we p r o g r e s s i n t h i s s t u d y , t h e i n f l u e n c e o f t h e c a n a l w i l l become more and more a p p a r e n t . I t w i l l h e remembered t h a t i t was f i r s t i n 1920 t h a t t h e c a n a l was a c t u a l l y u s e d i n any g r e a t measure by C a n a d i a n s h i p p i n g , and i t was not u n t i l 192?- t h a t any a p p r e c i a b l e volume o f s h i p p i n g r e s u l t e d . T a b l e 10, Pe.ge 60, shows how q u i c k l y C a nadians s t a r t e d t o u s e t h i s new s h o r t - c u t t h r o u g h C e n t r a l A m e r i c a . I t wi 11 be n o t i c e d t h a t i n 1921, t h e tonnage of s h i p s i n e i t h e r d i r e c t i o n , e a s t or w e s t , was o f v e r y l i t t l e consequence, Tonnage o r i g i n a t i n g i n E a s t e r n Canada was j u s t under 40,000 f o r the y e a r , w h i l e i n 1936 i t had grown t o v e r y n e a r l y 300,000 t o n s . S h i p s d e s t i n e d f o r t h e west c o a s t show 126,000 t o n s i n 1921, and t h o s e f o r the e a s t 16,000 t o n s ; the former a l m o s t d o u b l e d i n the e n s u i n g 15 y e a r s , w h i l e the l a t t e r i n c r e a s e d o v e r 30 t i m e s , a m o u n t i n g to o v e r 506,000 t o n s I n 1936. I n 1937, i t (60) TABLE 10 PANAMA TRAFFIC (iff LONG TONS) O r i g i n a t i n g ' Destined f o r Year Canada West Coast Canada East Coast Canada • West Coast Canada East Coast 1921 125,638 59,561 126,414 16,558 1922 180,981 25,174 148,305 6,521 192 3 604,546 92,959 101,588 12 5,28 3 1924 l j 223 ^  X 22 110,677 141,086 197,204 1925 1,082,282 121,803 158,709 '• 379,284 192.6 1,605,855 160,196 168,295 614,580 1927 1,548,783 207,003 248,009 803,418 1928 2,845,675 168,287 268,960 394,175 1929 2,650,646 251,128 266,453 539,767 1930 1,968,966 185,776 267,282 556,562 1931 2,507,257 157,756 271,621 492,252 1932 ' 2 p 38 3 p 21X 89,445 167,855 529,517 1953 2,896,162 121,875 134,511 328,038 ' 1934 2,201,180 196,204 189,227 498,706 1935 2,490,205 248,658 176,698 547,974 1956 2,705,567 298,884 225,174 506,673 Source; Canada Year Book, 1956, p.700. * i (61) reached a high l e v e l of 003,418 tons. This outstanding increase took place I n the tonnage of ship a o r i g i n a t i n g on the west coast and hound f o r p o i n t s east of the Panama Canal, and i s i l l u s t r a t e d on r a t i o paper I n Figure 14, Page 62. The f i g u r e s expressed i n Figure 14 may he s a f e l y assumed to he, f o r the most p a r t , Canadian cargo destined f o r markets east of the Panama, over the new sea route. C e r t a i n allowance must he made f o r p a r t cargoes picked up at American P a c i f i c coast ports en route, hut, on the whole, they i l l u s t r a t e s a t i s f a c t o r i l y the i n c r e a s i n g use to which Western Canada put the new t r a n s p o r t a t i o n route. Undoubtedly, t h e r e f o r e , t h i s increase i n cargo must be i n part r e s p o n s i b l e for the increase i n the Western Canadian export trade from 1920 to 1956, during which p e r i o d the value of exports f o r the r e s t of Canada was on the d e c l i n e , The i n c r e a s e i n Canadian t r a f f i c through the Panama Canal i n 1921-1922 was only moderate i n comparison w i t h other years, a, trend due i n l a rge p a r t , to the sharp drop i n Western Canadian exports at that time. However, from 1922 to 1929, exports from the West took a t u r n upward, and Panama R e g i s t r a t i o n s showed a more than proportionate g a i n . I t was n a t u r a l f o r t r a f f i c through the new waterway to increase very r a p i d l y at f i r s t - t h i s f e a t u r e i s common i n the use of any new highway u n t i l i t s p o t e n t i a l users a d j i i s t themselves to i t s use. The Panama Canal reacted i n just t h i s way f o r the f i r s t years, but by 1929, the trend had g r a d u a l l y eased o f f , and the increase had become more normal. (62) * \ (63) I n 19 £9 , western exports took a decided down-swing, while Panama t r a f f i c , although s u f f e r i n g temporary set-hacks, seems to have T maintained, on the whole, an appreciable i n c r e a s e . The increase was not as great as i n previous years, but, nevertheless, year by year, ships from the west coast of Canada continued to use the canal i n i n c r e a s i n g numbers. In order .to see more c l e a r l y where the impact of the canal was most f e l t i n Western Canada, i t i s now necessary to examine more c l o s e l y the trade of the separate provinces. In such a study, i t i s more d i f f i c u l t to get as s a t i s f a c t o r y s t a t i s t i c s as i n d e a l i n g with Canada as a whole. P r o v i n c i a l s t a t i s - t i c s do not supply as much d e t a i l e d i n f o r m a t i o n , and i n the record of imports and exports, neither the o r i g i n nor d e s t i n a t i o n i s g i v e n . The Canada Year Book s t a t e s t h a t , ' i n the case of exports, records for one province do not n e c e s s a r i l y imply that the goods o r i g i n a t e d i n t h a t province; l i k e w i s e , imports may not n e c e s s a r i l y be consumed i n t h a t province. Again, i n a province l i k e Manitoba, which has several customs p o r t s , there i s no a c t u a l record of where a c e r t a i n volume of exports goes; i t may be south i n t o the United S t a t e s , or i t may be east or west through Canada. However, i n s p i t e of these d i f f i c u l t i e s , a study of these records shows the g e n e r a l trend of trade development, and w i l l i l l u s t r a t e p r o v i n c i a l development i n general terms. In order to s i m p l i f y the o r g a n i z a t i o n of such m a t e r i a l , the i n f o r m a t i o n has been set out i n a s e r i e s of graphs and t a b l e s , which * 1 (64) appear on Pages 65-83, I n T a b l e s 11 and 12, Pages 81-82, w i l l be found i m p o r t s and e x p o r t s f o r the p r o v i n c e s f r o m 1906 t o 1936, and * the t o t a l i m p o r t s and e x p o r t s f o r W e s t e r n Canada, A summary o f t h e annu a l p e r c e n t a g e i n c r e a s e or d e c r e a s e , as c a l c u l a t e d f r o m t h e v a r i o u s l i n e s o f t r e n d , a p p ears i n T a b l e 15, Page 83. S i n c e each f i g u r e I s s e l f - e x p l a n a t o r y , i t i s h a r d l y n e c e s s a r y t o i n d e x them a t t h i s p o i n t r e f e r e n c e w i l l be made t o them from t i m e t o t i m e as t h e need a r i s e s . L o o k i n g f i r s t a t t h e g r a p h s o f i m p o r t s f o r t h e f o u r w e s t e r n p r o v i n c e s d u r i n g t h e p e r i o d 1906-1920 ( F i g u r e s 1 5 , 16, 17, and 1 8 , Pages 65-68), and comparing them w i t h t h o s e f o r Canada and Western Canada ( F i g u r e s 6-7, Pages 49 -50) , i t becomes q u i t e o b v i o u s t h a t a s t r o n g s i m i l a r i t y e x i s t s between them a l l . There i s , however, one d i f f e r e n c e ; i n Saskatchewan, A l b e r t a , and B r i t i s h Columbia, the changes from-year to y e a r a r e more pronounced, and over t h e whole p e r i o d t h e p e r c e n t a g e i n c r e a s e 'becomes g r e a t e r as one p r o c e e d s w e s t . The h i g h p o i n t i s i n A l b e r t a and Saskatchewan, T h i s was t o be e x p e c t e d , s i n c e t h e g r e a t e s t development t o o k p l a c e d u r i n g t h o s e y e a r s i n t h a t p e r t o f Canada, Saskatchewan t o p s t h e l i s t w i t h an a v e r a g e a n n u a l i n c r e a s e o f 13.6%; A l b e r t a i n c r e a s e d 12,7%; B r i t i s h C o l umbia 10,5% ( v e r y c l o s e , i t w i l l be n o t e d , t o t h a t o f Canada, 1 0 , 2 % ) ; end M a n i t o b a 7,5%. The average f o r W e s t e r n Canada was 9,6%, and w h i l e t h e r e was c o n s i d e r a h l e d i f f e r e n c e i n t h e r a t e o f development, one c o u l d say t h a t i t t o o k p l a c e c o n s i s t e n t l y r i g h t t h r o u g h the w e s t , and t h a t i t was a l a r g e share o f t h e g e n e r a l development i n Canada a t t h a t t i m e , (67) (68) (70) (74) ( 7 5 ) (76) (77) ( 7 8 ) (79) 180} (81) TABLE 11 IMPORTS BY PROVINCES "TOGO'S omittedT YEAR 3 e G s ALT A. ' SASK. MAN. V/. GM AD. 1900 10,532 6,699 1901 10,805 5,438 « , 1902 10,275 - - 8,703 «. 190 3 10,830 . 11,802 1904 11,816 - 14,235 1905 12,492 - _ 14, 282 1906 15,584 2,828 *j $ 3 3 5 19,117 40,864 1907* 12, 705 3,264 2,177 19,154 57,298 1908 23,406 4,621 3 j 753 22,454 54,245 1909 20,764 3,817 3. 386 17,506 45,473 1910 27,378 6,007 6,145 35j 5 9 1 65,121 1911 38,163 9 p 135 10,908 34,624 92,830 1912 49,154 13,721 14,236 42,459 119,570 1913 65,436 20 , 9 24 19,138 58,581 164,079 1914 56,864 18,330 14,176 . 45,739 135,109 1915 54,976 9 j 95 3 7,542 29,448 81,919 1916 33,025 6.489 6,337 26,637 72,488 1917 42,140 9,986 12, 550 40,539 105,195 1918 56,040 16,097 16,752 46,743 135,652 1919 63,594 1 5 £ 925 17,388 48,778 145,785 1920 67,108 18,883 16, 618 55,289 157,898 81,615 24,227 21,716 64', 8 23 192,581 1922 59,458 11,924 10,197 36,598 118,157 1923 60,257 10,395 10,715 38,878 120,245 1924 67,564 12, 550 13^933 39,671 132,718 19 35 66,486 13,497 9,866 37,176 127,025 1926 73,510 17,214 14, 896 42,877 148,497 1927 84,936 2 1 9 5 9 3 20,700 49,332 176,561 1928 89,569 25,900 26,645 52,820 194,954 1929 94,041 36,548 57,852 59,688 337 j, 9 39 1930 98,271 38.921 51,590 54,796 333f370 1931 77,842 21j049 18,766 35,971 153,628 1 9 3 3 50,530 9, 741 6,028 19,897 86,197 1933 35,849 6,420 4,891 13,949 61,109 1934 36,536 6,471 4,462 14, 322 61,791 1935 43,204 9 2 3 1 9 5,148 16,057 73,628 1936 45,980 10,805 6,351 18,220 81,363 * Nine months only. Source; Trade of Canada, 1935-36, p.27, Dominion Bureau of S t a t i s t i c s . (82) TABLE 12 EXPORTS BY PROVINCES (000*s omitted) Y E A R 3B« C e ALTA. 3 ASK. M A I . W . C M A D A 1900 17,851 •HO 5,568 1901 21,648 1,084 1902 18,385 - — 4,896 1903 15,604 2,068 1904 16,556 _ _ 1,049 «. 1905 16,677 - - 2, 575 «» 1906 22,817 329 540 1 P 9 35 25,621 1907* • 16,138 249 440 2,830 19,657 1908 25,941 297 885 4,105 29,224 1909 22,240 186 1 j 9 23 2,176 26,525 1910 25,068 161 2 y 912 4,192 52,553 1911 23,016 565 4,056 3,134 30,571 3-912 20,272 52 4,621 3,502 28,247 19 IS 27,087 162 .. 17,155 5 j 259 49,661 1914 55,918 283 8 j I H 9,067 51,379 3*91£3 35,627 469 7,185 11,558 52, 839 1916 59 £ 15 5 544 8,986 13, 452 61 j 9 55 1917 45,901 288 14,805 17,686 82,678 1918 58,614 631 17,924 22 £ 915 100,084 1919 77,247 2 f 256 20,707 22,906 125', 116 1920 97,905 2,209 50,852 54,572 165,558 1921 85,031 1,265 22,452 25,422 154,171 19 22 71,402 601 7,756 8,599 88,158 1925 96,665 637 12,957 12*j 9 2 2 12 5 £ 15 9 1924 139,689 455 11,095 11,062 162,279 1925 148,272 2,250 10,099 10,995 17l'. 596 1926 192,457 669 10,241 12, 414 215,781 1927 172,075 1 £ 153 9,849 r 15,496 198,573 1928 211,569 948 10,572 18,398 241,487 1929 237,585 1 p 211 11,051 17,084 266,929 1950 178,551 1 {j 14?1 10,727 15,918 206,357 1931 154,605 847 5 j 7 29 8,289 149,470 1952 109,956 502 3 £ 24:2 4,574 118,274 1933 104,546 442 1,446 4,876 113* p 110 1954 --• 102,786 553 2,396 7,975 115,710 1955 114,809 510 3 y 229 11,449 129,997 1936 159,984 885 7,175 12o 128 160,172 * Nine months only. Source; Trade of Canada, 1955-36, p.27 Dominion Bureau Of S t a t i s t i c s . (.83) TABLE 13. AWMJAL PERCENT AGE INCREASE OR DECREASE IN EXPORTS AND IMPORTS, 1906-1936 EXPORTS 1906-1920 EXPORTS 1920-1936 IMPORTS 1906-1920 IMPORTS 1920-1956 Canada Western Canada B r i t i s h Columbia A l b e r t a Saskatchewan Manitoba 16, 2% 14.7% 32.9% 22.5% 3» 2% - 4,2% -11,6% - 5.5% 10,2% 9,6% 10,3% 12, 7% 13, 6% 5.5% - 4.5% - 4.7% - 3, 2% - 5,6% - 6,1% - 7.7% * S (84) The export trade of Western Canada during t h i s period was not as evenly d i s t r i b u t e d as the imports, nor was the trade of the provinces as c l o s e l y r e l a t e d t o that of Canada. Exports of the west are i l l u s t r a t e d i n Figures 23, 24, 25, and 26, Pages 73-76, and, when compared w i t h Canadian and Western Canadian Exports from 1906 to 1920, (Figures 10 and 11, Pages 54-55), show marked d i f f e r e n c e s . A l b e r t a shows the lowest values of exports of a l l the provinces, r a n g i n g from the very low f i g u r e of $52,000 i n 1912, to a high of #2,256,000 i n 1919. From 1906 to 1912, exports f e l l o f f , except f o r one year of recovery - 1911. However, from 1912 to 1920, an enormous increase took place, much g r e a t e r f o r a s i m i l a r p e r i o d than.for any other province. I n s p i t e of the decrease i n the f i r s t s i x years. A l b e r t a ' s annual average increase was 13,9% f o r the whole p e r i o d . The exports of t h i s province also show much more accentuated f l u c t u a t i o n s from year to year than do those of any of the other provinces. . I t seems l i k e l y t h a t , on the whole, A l b e r t a had l i t t l e i n the way of surplus products t o ship out of the province, and that most of i t s c a p i t a l was being used f o r development purposes, Man i t oha and Saskatchewan show the g r e a t e s t development i n r e spect of exports, Saskatchewan had an annual average increase of 32.9%, and an o v e r - a l l increase of 460.6%5 and Manitoba, 22,5% and 315%, r e s p e c t i v e l y . The percentage increase of export values f o r B r i t i s h Columbia was 11,3%, with a t o t a l increase of 158.2%. The value s of imports f o r the four western provinces for ' 1 (85) the period. 1920-1936, when compared w i t h the value s of Canadian imports f o r the same period, e x h i b i t no great v a r i a t i o n s one from " another. (See Figures 19, 20, 21, and 22, Pages 69-72, and Figure 8, Page 51.) The general downward trend, as shown i n each case, ranges from the r e l a t i v e l y small annual average decrease f o r B r i t i s h Columbia (3,2%) to the decrease of 7,7% i n Manitoba., The trend of B r i t i s h Columbia values corresponds most c l o s e l y to that of Western Canada (Figure 9, Page 52) and Canada (Figure 8, Page 51). and the decrease per annum i s somewhat l e s s - 5.2% as against 4.5% for the Dominion and 4,7% for the West. The d e v i a t i o n s of the a c t u a l B r i t i s h Columbia va l u e s from the t r e n d v a l u e s f o r corresponding years i s somewhat l e s s than, f o r Canada, which f a c t would seem to i n d i c a t e that the trade of the province i s l e s s subject to wide f l u c t u a t i o n s than the Dominion as a whole, i . e . , l e s s l i k e l y to h i t extreme high or low p o i n t s * In 1929, the Depression caused a r a p i d drop i n the imports of Saskatchewan, Manitoba, and t h e Dominion, The corresponding l a n d s l i d e was n e a r l y a year l a t e i n coming to the two f a r western provinces, A l b e r t a and B r i t i s h Columbia. I t may be that t h i s was due to some p e c u l i a r c h a r a c t e r i s t i c s innate i n t h i s part of the Dominion. Probably the time element was i n part responsible f o r the delay, s i n c e orders would be longer i n being f i l i e d than i n the east. The record of Panama tonnage r e g i s t r a t i o n s of ships destined f o r the west coast (Table 10, Page 60) would suggest t h a t t h i s was t r u e . The ' I (86) l a t t e r decreased s l i g h t l y i n 1929, hut recovered i n 1930; the r e a l drop d i d not take place u n t i l 1932. T h i s does not c o n s t i t u t e d e f i n i t e ' evidence that the Panama Oanal was res p o n s i b l e for the value of imports f or these two provinces being sustained a year longer than the r e s t of Canada. However, i f we consider a l s o that the annual average decrease i n the v a l u e s of imports grows l e s s as we approach the P a c i f i c Coast - Manitoba 7.7%, Saskatchewan 6.1%, A l b e r t a 3.6%, and B r i t i s h Columbia 3,2% - there i s good reason to b e l i e v e t h a t p r o x i m i t y to the new water o u t l e t to Europe was a decided advantage. Now l e t us consider the values of exports f o r the four western provinces from 1920 to 193 6. (See Figures 27, 28, 29, and 30, Pages 77-80.) A comparison of the trends of these'values w i t h those f o r the Dominion (Figure 12, Page 56,) and Western Canada (Figure 13, Page 57) shows marked d i s s i m i l a r i t y i n a great many ins t a n c e s . A l b e r t a bears l i t t l e resemblance to e i t h e r Canada or Western Canada. The f l u c t u a t i o n s are very i r r e g u l a r , and the devia-t i o n s of the a c t u a l values from the normal are at times great. For example, exports i n 1924 were about $4,500,000, while t h e normal value was $10,000,000, I n the f o l l o w i n g year, the a c t u a l values were over$20,000,000, while the normal value was $9,500,000, I n no other province does one f i n d such a wide d e v i a t i o n i n so short a time. The cause of such f l u c t u a t i o n s i n the value of exports was p r i m a r i l y crop c o n d i t i o n s . However., over the whole period,- A l b e r t a exports decreased on the average only 4.2% per annum, a decrease not ' \ (87) much g r e a t e r t h a n t h a t f o r the Dominion ( 3.2%). Saskatchewan e x p e r i e n c e d t h e g r e a t e s t d e c l i n e i n e x n o r t s o f any o f t h e f o u r w e s t e r n p r o v i n c e s - 11,6% per annum. The h i s t o r y o f Saskatchewan wheat c r o p s over t h e past t e n y e a r s has been a-most d i s t r e s s i n g s t o r y . A s e r i e s of y e a r s w i t h no r a i n , d u s t storms, and r u i n e d crops has caused not o n l y t h o s e l i v i n g i n t h i s p r o v i n c e , h u t a l l C a n a d i a n s , t o l o o k on t h i s s i t u a t i o n as- a cause f o r g r e a t c o n c e r n -v i r t u a l l y a n a t i o n a l c a t a s t r o p h e . As i n the ease of I m p o r t s , we f i n d t h a t -the p e r c e n t a g e d e c r e a s e grows l a r g e r as we p r o c e e d e a s t , and t h a t p r o x i m i t y to t h e P a c i f i c Coast b e a r s a d e f i n i t e r e l a t i o n s h i p t o t h e p e r c e n t a g e change each y e a r i n e x p o r t v a l u e s - B r i t i s h Columbia 1,8% i n c r e a s e , A l b e r t a 4,2% d e c r e a s e , S a s k a t c h e w a n 11,6% d e c r e a s e , and M a n i t o b a 5*5% d e c r e a s e . I f we a l i o ? ; f o r the abnormal c o n d i t i o n s i n A l b e r t a and Saskatchewan, p a r t i c u l a r l y w i t h r e g a r d t o e x p o r t v a l u e s , t h e n we cannot hut r e c o g n i s e , I n the r e c o r d s o f p r o v i n c i a l t r a d e , a d e c i d e d r e l a t i o n s h i p between t h e v a l u e s of t h a t t r a d e and the d i s t a n c e o f each p r o v i n c e f r o m P a c i f i c t i d e w a t e r . B e f o r e t h e Panama C a n a l was put t o a c t i v e use hy Canadian s h i p p i n g , p r o v i n c i a l t r a d e b o r e l i t t l e r e l a t i o n s h i p t o d i s t a n c e from t h e P a c i f i c C o a s t ; f r o m 1920 on, t h e r a t i o seems to be i n almost d i r e c t p r o p o r t i o n . An a n a l y s i s o f t h e a c t u a l t r a d e r o u t e d v i a Panama C a n a l w i l l b e a r out t h i s c o n t e n t i o n even more f o r c i b l y . ' 1 ' (88) One f i n a l p o i n t of s i g n i f i c a n c e must be d e a l t w i t h b e f o r e p r o c e e d i n g t o a n a l y z e the t r a d e o f the P a c i f i c Coast i n g r e a t e r ' d e t a i l , I n r e c e n t y e a r s , and more p a r t i c u l a r l y s i n c e 1920, t h e s i m i l a r i t y between t h e t r a d e t r e n d s of B r i t i s h Columbia and W e s t e r n Canada has become more and more n o t i c e a b l e , From Table 15, Page 83, we f i n d t h e f o l l o w i n g p e r c e n t a g e s ? 1906-1920 1920-1956 E x p o r t s I m p o r t s Exp o r t s I m p o r t s Western Canada 14,7% 9.6% 1,1% -4.7% B r i t i s h C olumbia 11,3% 10.3%" 1.8% -3.2% I t w i l l be r e c a l l e d a l s o t h a t t h e y e a r t o y e a r changes i n B r i t i s h C o l u mbia t r a d e were much t h e same as t h o s e f o r Western Canada. T h i s i s due t o t h e f a c t t h a t t h e t o t a l t r a d e of B r i t i s h C olumbia b u l k s v e r y l a r g e i n t h e t r a d e of W e s t e r n Canada. As time has gone on, i t has come to c o n s t i t u t e a v e r y h i g h p e r c e n t a g e of t h e t o t a l t r a d e f o r the f o u r Western p r o v i n c e s . T a b l e 14, Page 89, shows t h e v a l u e o f B r i t i s h C o l umbia e x p o r t s and i m p o r t s e x p r e s s e d a s a p e r c e n t a g e o f t h e t o t a l W e s t e r n Canadian t r a d e . I t would seem f r o m t h e s e f i g u r e s t h a t t h e p r o p o r t i o n o f i m p o r t s e n t e r i n g «est e m Canada t h r o u g h B r i t i s h Columbia has been r e l a t i v e l y c o n s t a n t over the whole p e r i o d . Prom 1922 on, i t i n c r e a s e d t o 52%, dropped back t o t h e 1920 f i g u r e of 42% i n 1929, and ( d u r i n g t h e d e p r e s s i o n ) i n c r e a s e d t o i t s h i g h e s t p o i n t - 60% i n 1934. U n d o u b t e d l y , cheap t r a n s p o r t a t i o n of m a n u f a c t u r e d goods by the water r o u t e was p a r t l y r e s p o n s i b l e f o r t h e i n c r e a s e d u r i n g the d e p r e s s i o n ( 8 9 ) [TAB I E 1 4 . B R I T I S H C O L U M B I A E X P O R T S M B I M P O R T S A S A P E R C E N T A G E OP W E S T E R N C A M A D A E X P O R T S A N D I M P O R T S • 1 9 0 6 - 1 9 2 0 Y E A R E X P O R T S I M P O R T S Y E A R E X P O R T S I M P O R T 1 9 0 6 8 7 % 3 7 % 1 9 3 3 8 0 % 5 0 % 1 9 0 7 8 4 % _ 1 9 2 3 7 7 % 5 0 % 1 9 0 8 80%' . 4 3 % 1 9 2 4 8 4 % 50%" 1 9 0 9 83%' 4 5 % 1 9 2 5 8 4 % 52%' 1 9 1 0 7 6 % ' 4 2 % 1 9 2 6 8 8 % 5 0 % 1 9 1 1 7 5 % 4 0 % 1 9 2 7 8 7 % 4 8 % 1 9 3.3 7 1 % 4 1 % 1 9 2 8 8?%' : 4 6 % 1 9 1 5 5 5 % 40%' 1 9 3 9 88%' 4 2 % 1 9 1 4 6 4 % 4 1 % ' 1 9 3 0 8 6 % 4 9 % 1 9 1 5 63%' 4 2 % 1 9 5 1 9 0 % 5 0 % 1 9 1 6 6 4 % 4 6 % 1 9 3 2 9 0 % 5 7 % 1 9 1 7 5 7 % 3 8 % 1 9 3 3 9 2 % 5 9 % 1 9 1 8 5 9 % 4 1 % 1 9 3 4 8 9 % 6 0 % 1 9 1 9 6 2 % 43%" 1 9 3 5 8 8 % 56%* 1 9 2 0 5 8 % 42%* ' 1 9 5 6 8 7 % &Z% 1 9 2 1 6 2 % 4,1% (90) years. A n a l y z i n g B r i t i s h Columbia's p r o p o r t i o n of Western Canada exports, t h i s province r a p i d l y gave way to the other provinces from 1906 to 1920. This p o s i t i o n changed a p p r e c i a b l y from 1920 on. I n that year, 1920, B r i t i s h Columbia exports were only 56% of the t o t a l Western Canada exports: i n 1933, they c o n s t i t u t e d over 92%. Since that time, the p r o p o r t i o n has dropped somewhat, hut, on the whole, the province has continued to m a i n t a i n the l a r g e r p r o p o r t i o n , which was over 85% of the t o t a l i n 1956. The development of B r i t i s h Columbia trade since 1920 has been due i n l a r g e measure to three t h i n g s ; f i r s t , , t o the tremendous growth i n Canadian f o r e i g n trade; second, to the f a c t that t h i s province has products not found i n the other Western provinces to export to world markets; and, t h i r d , to the opening of the Panama, Canal. Of these three f a c t o r s , the l a s t i s the more important, s i n c e , without the c a n a l , B r i t i s h Columbia would be at a d i s t i n c t disadvantage, due to excess t r a n s p o r t a t i o n costs.. F i n a l l y , as we proceed with a more d e t a i l e d study of B r i t i s h Columbia c o n d i t i o n s , i t wi 11 become more and more apparent that the Panama Canal has been probably the most important f a c t o r c o n t r i b u t i n g to the increased p a r t i c i p a t i o n of t h i s province i n Canadian f o r e i g n trade, (91) CHAPTER 711 Of the four provinces of Western Canada, B r i t i s h Columbia i s unique i n c e r t a i n r e s p e c t s . We have seen, i n the f i r s t p lace, that i t i s cut o f f from the r e s t of the Dominion by a formidable n a t u r a l b a r r i e r , the Rocky Mountains, Again, we have observed t h a t the p r a i r i e provinces depend almost e n t i r e l y on one type of production, that of -wheat. We s h a l l find', as we proceed, that B r i t i s h Columbia has a much more v a r i e d economy than her s i s t e r provinces of the West, She produces, among other t h i n g s , pulp and paper, lumber, and wo od products. She e x t r a c t s from her mines a great v a r i e t y o f minerals, i n c l u d i n g gold, s i l v e r , c o a l , copper, and many non-ferrous metals: from the sea, a wide v a r i e t y of f i s h , which i s exported both canned and f r e s h ; and from the land, a v a r i e d assortment of a g r i c u l t u r a l products. Such a wealth and heterogeneity o f pro ducts has been responsible f o r a c o n s i s t e n t volume of exports t o a l l quarters of the globe. I n sn e a r l i e r chapter, we saw that t he re e x i s t e d a c e r t a i n geographic u n i t y between Canada's P a c i f i c province and the P a c i f i c s t a t e s of America, hut that the Canadian t r a n s - c o n t i n e n t a l r a i l w a y system tended t o o f f s e t any disadvantages to an ungeographic u n i t y East and West. The Panama Canal has been the fa c t o r next i n importance to the r a i l w a y s i n cementing the bond between B r i t i s h Columbia and the res t of the Dominion. I t accomplished t h i s d i f f i c u l t task by making the Ea s t e r n Canadian market more a c c e s s i b l e to B r i t i s h Columbia producers and consumers, and by p l a c i n g t h i s province i n a more favorable p o s i t i o n t o snare i n Canadian trade w i t h overseas c o u n t r i e s . I t opened *a market i n the United Kingdom which has "brought great wealth to t h i s province, a market which, p r i o r to 1921, was almost p r o h i b i t e d by long t r a n s p o r t a t i o n hauls with t h e i r consequent high f r e i g h t charges. I n the past, where Canada has negotiated trade agreements w i t h European c o u n t r i e s , B r i t i s h Columbia, even w i t h concessions i n the way of lower t a r i f f r a t e s , found i t d i f f i c u l t , and at times impossible, to p a r t i c i -pate i n t h i s t r a d e . I n p o i n t of time, 'while the P a c i f i c Coast i s s t i l l at a disadvantage i n competing f o r trade i n f o r e i g n markets, the cost element has been cut down to such an extent as to allow a much more equitable b a s i s f o r p a r t i e i p a t i o n . Canadian products exported to f o r e i g n markets must he shipped out of the Dominion i n one of three ways: East, down the S t , Lawrence watershed; South, through the. United S t a t e s ; or West, through B r i t i s h Columbia, S i m i l a r l y , goods imported from f o r e i g n c o u n t r i e s must enter by one of these three channels. Since 1921, the Western route has become more and more popular, as witnessed by the trade f i g u r e s . The v o r t e x of t h i s flow of goods i s Canada's c h i e f port on the P a c i f i c - Vancouver, Lu r i n g the l a s t 50 years, the growth and development of the C i t y of Vancouver, from a comparatively small town to the t h i r d l a r g e s t c i t y i n the Dominion, has been remarkable. During t h i s time, i t became the P a c i f i c Coast t e r m i n a l f o r the two t r a n s - c o n t i n e n t a l r a i l w a y > i (93) systems, and i t s p o p u l a t i o n ha,s grown from 13,700 i n 1891, to 246,600 In 1931. Having the best harbor f a c i l i t i e s of any- port i n B r i t i s h -Columbia, i t has become the d i s t r i b u t i n g center for the bulk of goods consumed i n the province, and the shipping center for the l a r g e s t part of a l l Canadian goods, exported v i a the P a c i f i c Coast, The s t o r y of Vancouver's development i s best to Id i n the s t a t i s t i c a l evidence at hand. Although there are l a r g e gaps i n the data a v a i l a b l e , they w i l l show the general trend i n the development of t h i s p o r t . I n order to appraise the r e l a t i v e Importance of the p o s i t i o n of Vancouver t r a d e i n B r i t i s h Colurnbia* s t o t a l t r a d e , i t i s necessary -to compare the f i g u r e s f o r exports and imports as s u p p l i e d by the Dominion Bureau of S t a t i s t i c s , B r i t i s h Columbia imports and exports are given i n Tables 11 and 12, Pages 81 and 82, Table 15, Page 94. contains the value f i g u r e s f o r the f i v e p r i n c i p a l , p o r t s of B r i t i s h Columbia, v i z . , Vancouver, Few Westminster, V i c t o r i a , P r i n c e Rupert, and Nanairno, and shows, i n a d d i t i o n , the percentage of B r i t i s h Columbia imports and exports passing through the P o r t of Vancouver. . Figures 31 and 32, Pages 95 and 96, show the percentage Vancouver values bear to t o t a l B r i t i s h Columbia v a l u e s . Where l i n e s of trend are c a l c u l a t e d , the method used i s the same as that employed heretofore, w i t h one exception. Due t o the f a c t that Dominion Bureau f i g u r e s f o r the C i t y of Vaneouver only go back to 1908, the t o t a l period has been d i v i d e d i n t o the two sections,, 1908-1920 and 1920-1936, instead of the previous d i v i s i o n , 1906-1920 and 1920-1956, to to C7> r-l 1 CO o 01 8 H o CO 0) += 4=> • H s 1 ° era r-H PH r-H s H PH AH PI o cm E-t PH O ft 5 E H PI o o o I CJ 1-oJ 03 P1 o I PH Is 1° PI EH w o CO EH « o CO E H PH o ft co EH s CO E H PI o CO E H 8 CO & s CO E H PH O ( 9 4 ; p ^CO O) N N O O t- O o o> o c - w in o o ^ t O ^ t O C O W r H o f c v T ^ T i ; 1 1 1 1 1 1 1 1 1 l S < l l O ! N C 0 W c n l N C f t N c 0 K i n b . W N O l c o c o c o c a c n t o c o t o c o w ^ i i v c o r a c o c D M O r H t n t o t o i o i o i n t o i v j s i n . r j i e i ^ ^ i i C ) N N C O H M n H ^ n W N m t O N r H O I N I i I I I ! I I ! I I I I I i I I I I 8 I ! I ! 1 1 M c o a i o c o N o H < | o ) < # m ( i i M ^ > l o > W H H H i f l ^ c o n o » M a ) to LO O O H K O ^ i f l O N O O O f i j H M o r-~o>WLOLOoi>-cr> H H r l C i M H r-t CO CO LO <sj< £- cn - - - - - - „ . I D Ol t | W O B CO to CNCT>cO<^cOb- !>-£•- Q CO lO 1Q t- LO ^ o n o> N co is . cn co ^  I D t - i s ,.- w „ t - . ^ v j . t f ) t f J « ) W K i ^ 0 0 ^ 0 5 1 Q ^ * l LO CO «"l flt tfj #1 ft ST, #V «3i «\ r- ) i—Ir- tr -Hr—i<—tr- ir -Hr-J I I I I I t O O X O I f l M i a i f l N C D ^ . r l i D M W W N t f M O ^ W c o W O T ^ * c F c o c n i n o « i n o c o « t f c v 2 , > - c n i f l O l W l Q c D M H M W c O C O r H t C C f t ^ i n H CO LO jra $ . to & D O . 1^ 1 LO O SS. EH pqlevi to «^  «\ ^ ^ M t o M ^ ^ L O ^ t o w ^ ^ r o c o w L o ^ ' ^ N H H f f l M o i c n M o i O ) l f l ' O b l O > J O O O « l f l t O < J > O i a H c O H H N ^ S r i S i S Q ^ ^ ^ ^ ^ ^ ^ ^ ^ t o M ^ O r t r H g i c n i f i c o o . ^ ^ c i i ^ H ^ o t o ^ c o t s M ^ ^ D o l O l n ^ o c o w N o n ^ ^ H ^ r o H K ) w *3< <4< CO r - i CD «3t !V- CO CO C R c Q ( J 3 t n H « # ( J } ^ r H ! S c O CnOCOlOtOcOcOlNOTcO<r>cnt^<HlC \ 2 C O CO CCS <—! M W N H (O o o> o w <f n c o *» «» « LO LO <rj< CO Q O LO tO <: v, .^ 1—I H N t O CO 1—4 03 iH m t>- LO O i i f i H B c o o i O M o t O l O >-. CO "rj< LO CO 1 - ! <«# CM cn t-H r-H rH rH r—! r—f •H LO Cn CO in oi 02 to co to cn cn •ft »v ff* LO CO o co r l H OJ M I I ! I I I I I 1 0> c n Irt H M O) « ) <# N W O O ' ^ N H ' r J O M i n ( O M O M ! 3 c O t O C O C O i Q M c i > M ( a M o w e n W N L 0 ^ 0 4 t 0 ^ t 0 ^ ^ r H ^ r H O O C D < H C 0 f > -w i Q o ^ ^ o i c f t o t < i N t o i < ) ! | m c « ^ 0 ) O c i i o ) W » o i c o o o n o t B O « 3 C 0 T 4 ) C C 2 C D L 0 C 0 co to to -st< *HH to co O C O C D ^ O H i n N M c O H o O l s O ^ O ^lOlflCOrsE-J>.CONI>-lsI>.!st^.l£ltD«) CO EH g ft H i n CO C- CO cr. co ^(i CO CA2 OS IN cn to co cn w n H n c o n i o c i > ^ Q M « < # o H f t i - c f i n i n i ^ « * t - ' c p H C O C ^ C Q ^ - C O ^ E N C O O O C O C V J M C M ^ W C O O L O ^ W 10 10 o- is N cn m LO LO r-H * i m c o c o N ( J i o w w c f t i n « i i r H H r H M t f l n i n < # t o o > o < } rH r-l C Q t O i - H E - - L O C O O l > - CO-sP H l O c o W f f i N C O C O t - c O rH r-l r-H r-H !3 -"v .--t i EH D l o < O to CO E H P H < LO' LO co W r H ^ c ^ c O ^ L O C ^ ^ ^ l t O C M O O W ^ ^ c O L O a 3 C O r - ) t o c O CO CO e *> • ® o 6 e • • « • • o e> t & » a CO CO CO CO r - t - O ^ M N W a i H c O o O ' H H W M o H H i n ^ B M C O t O t O t O N c O t O ^ ^ N N O C - C O C O C O C O C O C O C O C O C O C O C O C O C O 03 E H pi o LO CO LO LO CM CO _ _ ^ _ „ . ^ w O N M M i a ^ d d w H N N M N M o i c o S f f l S o S O L O L O Q O L Q c O O > O 2 c O C O i - l L O L O c 0 O E O o C \ I O J o o N M i o i n c o t o H i n i n n t o o i Q ^ o i o c o !>- o to o «3< O Cn CD CM co b-_ - IS- Oi LO to c co cn cn *i< C O r - l f - L O W C O E - L O C n r H H r H M N ^ K M H O to cn ^fi -i- <HH j^) CO t o n n c n o i ^ c - c n n o o o L O O D ^ L O L O L O t O ! N - J N t > C 0 ^ i < t O t O t O C O c o c n o H W l o ^ l Q ^ o ^ . a 3 c B . o H M n ^ l O l o c - c D O ) O H l ^ I l n « j | | o < o O G r H r ^ r H r H r - J , - l r H r H H i H C \ ! W W W O a W cn o> 01 a> cn cn ov o> oi roroa>rowaicncncno)C!>o>o>aiO)cno> cn cn cn r - H r H r — l r - H r H r - l r - 4 r - I i H r - J i - ^ I r H r - j r ^ r - l r H r H r H r H r H r - l r - l r - l r - l r - l r - t i - l r - H r - l > h (97) I n a l l other r e s p e c t s , the method of a n a l y s i s i s the same. The s t a t i s t i c a l evidence submitted i n d i c a t e s the r e l a t i v e importance of Vancouver t r a d e i n the t o t a l f o r the province. I n 1908, Vancouver exports represented under 30% of the t o t a l f o r B r i t i s h Columbia, and while t h i s percentage g r a d u a l l y increased to 50% i n 1918 and 1919, i t eased o f f t o l e s s than 40% i n 1920. From 1920 on, the p r o p o r t i o n increased very r a p i d l y , u n t i l , i n 1933, the value of t h i s c i t y ' s exports amounted to over 75% of that f o r the whole province. The import t r a d e of the province, however, has always been l a r g e l y through Vancouver, never f a l l i n g below 60%. a f t e r 1910, From 1920 on, the percentage decreased i n one or two years, but, on the whole, i t has shown a moderate and steady increase, As i n the case of exports, the high p o i n t was reached i n 1933, when over 85% of Canadian imports entering from the West came through t h i s p o r t . T h i s i n d i c a t e s the importance of Vancouver's p o s i t i o n as a d i s t r i b u t i n g center f o r not only B r i t i s h Columbia, but a l l of Western Canada, The trends of import values f o r Vancouver (Figure 33, Page 98) and B r i t i s h Columbia (Figure 18, Page 68), for the p e r i o d 1908-1920, show some considerable d i f f e r e n c e one from the other. For the f i r s t h a l f of the p e r i o d , i . e . , up to t h e beginning of the War, the develop-ment of the two was much a l i k e , hut from 1914 to 1916, while' both drop considerably i n value, Vancouver shows the g r e a t e r r e l a t i v e decrease. Such a decrease i n P a c i f i c Coast imports was due, i n large measure, to the general decrease throughout the Dominion i n the purchase of overseas ( 9 8 ) (100) (102) f o r e i g n goods, and a consequent i n c r e a s e i n t h e v a l u e of i m p o r t s • f r o m t h e U n i t e d S t a t e s . Under t h o s e c o n d i t i o n s , i t was q u i t e n a t u r e ! t h a t B r i t i s h C o l u m b i a d i d not s h a r e t o such a l a r g e e x t e n t i n t h e i m p o r t t r a d e , s i n c e most A m e r i c a n p r o d u c t s were s h i p p e d t h r o u g h the S t a t e s on A m e r i c a n r a i l w a y s t o t h a t p o i n t on the b o r d e r c l o s e s t t o t h e f i n a l d e s t i n a t i o n of t h e goods. I n a d d i t i o n t o t h i s s i t u a t i o n , w h ich was the p r o d u c t of abnormal c o n d i t i o n s , the C i t y o f Vancouver shows a somewhat l o w e r a n n u a l a v e r a g e i n c r e a s e over t h e whole p e r i o d t h a n the p r o v i n c e - 9.7% t o 10.3%. For the p e r i o d 1920-1936, t h e r e c o r d s o f Import v a l u e s f o r t h e p r o v i n c e ( F i g u r e 22, Page 72) and f o r t h e c i t y ( F i g u r e 34, Page 99) a r e almost I d e n t i c a l , S i n c e Vancouver i m p o r t v a l u e s d u r i n g t h i s p e r i o d c o n s i s t e n t l y m a i n t a i n e d a p e r c e n t a g e of the t o t a l f o r t h e p r o v i n c e of o v e r 80%, t h e degree of s i m i l a r i t y between t h e two i s not u n a c c o u n t a b l e . The p e r c e n t a g e a n n u a l d e c r e a s e i n t h e two c a s e s i s e x a c t l y the same, I n comparing the v a l u e s o f Vancouver e x p o r t s f o r the p e r i o d 1908-1920 ( F i g u r e 35, Page 100) w i t h t h o s e o f B r i t i s h C o l u m b i a ( f i g u r e 26, Page 76),- we f i n d a c e r t a i n degree o f s i m i l a r i t y between t h e two. The p e r c e n t a g e a n n u a l i n c r e a s e f o r t h e c i t y was much g r e a t e r t h a n t h a t f o r t h e whole p r o v i n c e , 17,6% as a g a i n s t 11.3%, but t h i s was l a r g e l y on a c c o u n t of t h e v e r y r a p i d g r o w t h o f the c i t y d u r i n g the boom p e r i o d o f 1912-1913, and, l a t e r , b y the e f f e c t s of t h e Great -V/ar tipon. t r a d e . The g e n e r a l t r e n d , and t h e d e v i a t i o n s f r o m t h e t r e n d , a r e * 1 (103) s i m i l a r i n b o t h c a s e s , a l t h o u g h t h e former shows a much more a c c e n t u -a t e d development than t h e l a t t e r , ' A g a i n , comparing s i m i l a r v a l u e s f o r the p e r i o d 19,80-1936, ( F i g u r e 36, Page 101, and F i g u r e 30, Page 80), w e ' f i n d a degree o f s i m i l a r i t y , b u t one much l e s s pronounced t h a n i n t h e e a r l i e r p e r i o d . Vancouver e x p o r t s were on t h e i n c r e a s e from 1920-1921, w h i l e B r i t i s h C o l u m b i a v a l u e s f e l l , B o t h eased o f f d u r i n g the d e p r e s s i o n o f 1922-1923 and f r o m t h e n to 1929 , b o t h showed r a p i d i n c r e a s e s . The b r e a k i n t r a d e advances carne, i n b o t h c a s e s , i n .1929, and the d e c r e a s e i n e x p o r t s • l a s t e d u n t i l 1934, As we saw before,, B r i t i s h C olumbia was t h e o n l y p r o v i n c e of Western Canada to m a i n t a i n an average a n n u a l i n c r e a s e i n e x p o r t v a l u e s over the whole p e r i o d 1920-1936, The d iagrams i n d i c a t e t h a t t h i s i n c r e a s e was even more pronounced f o r t h e . C i t y of Vancouver t h a n f o r t h e p r o v i n c e . The f o r m e r ' s i n c r e a s e p e r y e a r was 2,9%, w h i l e the l a t t e r ' s was 1,8%. I n our r e s e a r c h tip t o the p r e s e n t t i m e , t h e s o u r c e o f most of our s t a t i s t i c a l i n f o r m a t i o n has been t h e Dominion Bureau o f S t a t i s t i c s , As we go on to a more d e t a i l e d s t u d y of Vancouver t r a d e f i g u r e s , i t i s n e c e s s a r y t o b r i n g i n t o u s e the annual r e p o r t s of the Vancouver Harbor B o a r d . W h i l e t h e s e f i g u r e s a r e q u i t e comprehensive and d e t a i l e d , we e n c o u n t e r s e v e r a l d i f f i c u l t i e s i n d e a l i n g w i t h them, I n the f i r s t p l a c e , p r a c t i c a l l y a l l of the annual r e p o r t s g i v e e x p o r t s 1 (104) and imports i n tons, and not i n d o l l a r s . I have he en t o l d that i,hat d o l l a r values are g i v e n are merely guesses, and from my experience with the rep o r t s , I would say that the value f i g u r e s are very poor guesses and wholly u n r e l i a b l e . Again, these r e p o r t s do not go back-e a r l i e r than 1920, so th a t a comparison of tonnage before and a f t e r the opening of the canal i s not p o s s i b l e . However, they do give tonnage f i g u r e s for exports by d e s t i n a t i o n , and f o r imports by o r i g i n , and from these f i g u r e s i t has been p o s s i b l e t o estimate the amount o f • Vancouver trade passing throxigh the Panama Oanal. F i n a l l y , due to changes i n a d m i n i s t r a t i o n and p o l i c y , the Harbor Board r e p o r t s c o n t a i n no export and import f i g u r e s f o r the years 1930 and 1936. Table 16,, Pages 105-106, g i v e s a d e t a i l e d account of Vancouver trade by areas from 1921 to 1935, Those areas have been chosen which have been d e f i n i t e l y a f f e c t e d by the Panama Canal i n t.i e i r trade r e l a t i o n s w i t h Vancouver. The l a s t column i n the t a b l e shows the estimated Vancouver tr a d e which, passed through the canal each year during the period. This i s only an estimated figure,, i n as much as i t was d i f f i c u . l t at times to a r r i v e a t exact f i g u r e s f or some South and Central American c o u n t r i e s . Fig u r e s 37 and 58, Pages 107 and 108, i l l u s t r a t e g r a p h i c a l l y the estimated tonnage of Vancouver imports and exports shipped through the Panama Canal. I t w i l l be seen from Figure 37 th a t imports passing through the Canal to Vancouver increased r a p i d l y during the f i r s t year ~ (105) TABLE 16 VANCOUVER TRADE BY AREAS - 1921-1956 Tonsj weight and measure. (Excluding logs and lumber,) YEAR TOUTED KINGDOM CANADA - SOUTH YffiST TOTAL THRU ATLANTIC EUROPE AFRICA AMERICA INDIES PANAMA 1921 Imports E x o o r t s 15.892 52 »>94:2 18,064 25,664 42,718 57 51,064 1922 Imports E x p o r t s 42,751 303,955 43 22,895 50,465 36 58,175 123,864 3,681 366,129 IS 33 Imports E x p o r t s 73,028 453,123 6,315 3 BI 3 & X • 9,022 134,927 795 353 19,986 108,351 33o 59 X ^  7 9 3 X 9 34r Imports Exports 65,164 911,058 25,637 4,411 5,898 322,861 1,583 15,051 23,187 134.939 114 559 1,240,586 1925 Imports Exports 78,006 28,583 54,177 - 1,945 45,019 185,730 577,439 7,675 196,178 1,960 2,16c' 412 785,832 1926 Imports Exports 88,959 758,688 35,978 40 , 540 76,530 6,124 7,175 214,766 260 , 0 27 19 , 9 7 4 6,019 5,0 7 0 1,090,118 1927 Imports Exports 83,582 645,347 60,042 5 3«7 X X 67,518 150 9,605 563,061 17,205 7,456 3,491 224,388 2,498 1,515,646 1928 Imports Exports 77,857 1,452,951 36,039 78,943 07 X9 n 327 52,959 947,505 12,884 28,346 3,558 215,681 21 2,494.646 1929 Imports Exports 90,304 924,882 67,201 93,461 149 14,005 63,840 749,254 14,165 24,909 18,191 285,309 381 1,777 . 431 1950 Imports Exports (106) TABLE 16, coma, VANCOUVER TRADE BY AREAS - 1921 - 1936, UNITED CANADA -YEAR KINGDOM ATLANTIC SOUTH WEST TOTALlHHJ EUROPE AFRICA AMERICA INDIES PANAMA 1951 Imports 59,252 Exports 1,034,191 19 33 Imports 51,687 18,745 Exports 1,805,042 1955 Imports . 77,409 •Exports 1,584,456 1954 Imports 61,793 Exports 1,171,056 1955 Imports 65,880 28,251 58,388 22,276 24,566 24,835 55 ^ 783 27,603 45,271 Exports 1,505,526 25,425 1956 Imports - -Exports - -46,975 4,709 45,278 34,348 184,445 764,099 27,516 58,880 57,942 1,903.074 22,358 8,441 29,512 27,619 103,543 982,018 6,816 5,659 30,258 2,825,791 24,258 5,850 19,193 17,511 151,076 599,622 6,648 38,997 34,966 2,054.558 22,974 12,617 58,181 28,951 191,347 465,839 10,795 56,690 35,389 1,709,983 26,090 4 S3,124 29,596 107,369 239,256 18,370 51,600 28,753 1,617,957 N.B, Figures f o r 1930 and' 1956 are not a v a i l a b l e , Source; Vancouver Harbor Board Reports, 1921-1936. (107) &4 (108) * to si EH O {109} from 42 thousand tons i n 1921 to 123 thousand tons i n 1922. From 1922 to 1929 j the canal came more and more into use as a channel f o r trade from p o i n t s east of Panama to the Port of Vancouver. A guess only i s p e r m i s s i b l e f o r 1950 ( s i n c e the f i g u r e s are not a v a i l a b l e ) , but for the f o l l o w i n g two years, imports d e c l i n e d very r a p i d l y . They recovered again i n 1953-1954, and f e l l o f f i n 1955. I t i s not p o s s i b l e to o h t a i n an approximate f i g u r e f o r 1956. The tonnage of exports shipped through Vancouver v i a Panama Canal (Figure 58, Page 108) rose even more r a p i d l y than that of imports, I n 1921, only 50 thousand tons were shipped t h i s way, while i n 1922, the shipments increased to over 350 thousand tons. A temporary set--hack was experienced i n 1951, but i n 1952, coincident w i t h the completion of the Ottawa Agreements, exports from Vancouver through the canal reached a new high l e v e l of 2,825 thousand tons. Table .16, Page 105, shows that over 1,800 thousand tons, i . e . , over 60% of t h i s trade, was w i t h the United Kingdom. I t i s safe to say that without the Panama Canal, Vancouver would have been at a great disadvantage In competing f o r t h i s trade w i t h the United Kingdom, and i t seems al t o g e t h e r l i k e l y that i t s exports t o the United Kingdom would have been only the smallest f r a c t i o n of t h i s f i g u r e , .Since 1952, the volume of exports has been on the d e c l i n e , a s i t u a t i o n which has been due i n no small measure to the p a r a l y s i s o f the g r a i n trade. This w i l l he dealt with more f u l l y i n a l a t e r chapter. Table 17, Page 110, g i v e s the t o t a l deep sea tonnage of ( 1 1 0 ) TABLE 1? T O T A L V A N C O U V E R TOHffJSE, L E S S F O R E I G N COASTWISE M B B R I T I S H C O L U M B I A COASTWISE -( D E E P S E A ONLY) A P P R O X I M A T E " P E R C E N T A G E VIA PANAMA YEAR IMPORTS E S P ORTS IMPORTS EXPORTS 1 9 2 1 418,257 501,518 10% 16% 1922 4 3 9 , 5 0 0 752,045 28 4 9 1923 387,102 • 1,091,173 28 29$" ' 1 9 2 4 35o j »2It? 2,015,658 38 6 2 1 9 2 5 *? 1 5 5 1,945,732 26 4 0 192 6 . 1 , 1 2 2 , 2 5 7 2,689,947 19 4 1 1 9 2 7 , 1,285,589 2,683,015 17 56 1 9 2 8 1,314,127 4,558,091 16 57 1929 1,718,088 3,619,153 20 4 9 1 9 3 0 1,527,364 2 ,862,889 - _ 1 9 3 1 1 , 5 6 4 , 7 2 7 S j 9 *D>2 j SO 3 14 50 1 9 3 2 1^  f-Jl», 1*72 3 ^ /«) 3 ^ 1 0 5 8 75 1 9 3 3 1,158,763 2,881,015 1 3 7 1 1954. 1 »j 5 1 3 j 1 3 5 2 , 6 2 2 , 8 0 1 14 ' 65 1935 1,351,792 2,493,114 8 65 Source; Van co uv er Ha .rbor Board Reports, 1921-1936, • ' (111) V a ncouver i m p o r t s and e x p o r t s from 1921 t o 1935. These f i g u r e s do not i n c l u d e f o r e i g n c o a s t w i s e , i . e . , Puget Sound, o r B r i t i s h C o lumbia c o a s t w i s e t r a d e , and c o v e r o n l y i m p o r t s and e x p o r t s o r i g i n a t i n g o r d e s t i n e d f o r p o i n t s beyond Cape F l a t t e r y . The l a s t two columns e x p r e s s t h e a p p r o x i m a t e p e r c e n t a g e Vancouver-Panama t r a d e b e a r s t o t o t a l V ancouver deep s e a t r a d e . I t w i l l b e n o t i c e d t h a t the r e l a t i v e I mportance to Vancouver o f i m p o r t s p a s s i n g t h r o u g h t h e c a n a l has not been I n c r e a s i n g . T h i s i s not due to t h e f a c t t h a t t h e l a t t e r are l e s s , but r a t h e r t h a t i m p o r t s from P a c i f i c c o u n t r i e s a r e more. On t h e o t h e r hand, t h e e x p o r t tonnage t h r o u g h t h e c a n a l from. V a n c o u v e r ha.s grown a g r e a t d e a l , p a r t i c u l a r l y s i n c e 1924, By 1952, Vancouver-Panama tonnage c o n s t i t u t e d o ver 75% o f t h e deep sea t r a d e out of t h i s p o r t , and i t has m a i n t a i n e d ' a c o n s i s t e n t l y h i g h p e r c e n t a g e s i n c e t h a t t i m e . ' \ (112) CHAPTER V I I I We have se e n , so f a r , t h a t t h e e x p o r t s of wheat, p u l p and p a p e r , and o t h e r p r i m a r y p r o d u c t s have p l a y e d a v e r y i m p o r t a n t p a r t i n t h e economic s e t - u p o f Canada, end more p a r t i c u l a r l y , o f W e s t e r n Canada. I n t h e Post-War p e r i o d , the Dominion has shown a c o n s i s t e n t l y l a r g e e x c e s s of e x p o r t s i n t h e m a j o r i t y of y e a r s , and p r o s p e r i t y has come t o depend, t o a g r e a t e x t e n t , on our a b i l i t y t p s e l l t h e s e p r o d u c t s i n TO r i d markets* There has been a d e c i d e d s h i f t f r o m E a s t t o West i n t h e e x p o r t t r a d e , and t h e P a c i f i c p r o v i n c e has a t t a i n e d a new prominence i n t h e Canadian economy. I t w o u l d seem a p p r o p r i a t e , a t t h i s p o i n t , to i n v e s t i g a t e the v a r i o u s c h a n n e l s t h r o u g h w h i c h t h i s t r a d e passes,, not o n l y t h e Canadian i n t e r n a l c o m m u n i c a t i o n system, i . e . , t h e r a i l w a y s , b u t a l s o t h o s e c h a n n e l s w h i c h e x t e n d beyond t h e b o r d e r s of t h e Dominion, t h o s e i m a g i n a r y l i n e s w h i c h t r a v e r s e the s e a s t o f o r e i g n l a n d s . C o m m e r c i a l l y , Canada i s d i v i d e d r o u g h l y i n t o two d i s t i n c t t r a d i n g a r e a s : the e a s t e r n s e c t i o n , s t a r t i n g deep i n t h e p r a i r i e p r o v i n c e s and f e e d i n g down t h e n a t u r a l c h a n n e l of t h e S t . Lawrence waterway i n t o A t l a n t i c t i d e w a t e r at M o n t r e a l and S t . John; the w e s t e r n d i v i s i o n , s t a r t i n g somewhere n e a r the A l b e r t a - S a s k a t c h e w a n boundary l i n e and f e e d i n g i n t o P a c i f i c t i d e w a t e r a t Vancouver. The e a s t e r n d i v i s i o n i s w e l l s u p p l i e d w i t h t e r m i n a l f a c i l i t i e s , n o t o n l y i n t h e two p o r t s mentioned, but else? i n T o r o n t o , H a l i f a x , and Q u e b e c F u r t h e r , i t i s ' ' connected by r a i l w i t h t h e t e r m i n a l f a c i l i t i e s o f A m e r i c a n A t l a n t i c p o r t s . ' '. (113) The ' w'est, on the other hand, i s l i m i t e d to one major o u t l e t , the P o r t of Vancouver, and two sn a l i e r terminals at P r i n c e Rupert and Hew Westminster* American P a c i f i c t e r m i n a l s are of no advantage to Canadian ex p o r t e r s , because of high t r a n s p o r t a t i o n costs a r i s i n g out of the mountainous nature of the P a c i f i c s l o p e . Consequently, Canadian P a c i f i c trade concentrates l a r g e l y at Vancouver,, and future development may he expected to talee p l a c e at t h i s point. The two p r i n c i p a l r a i l w a y systems of Canada are the t r a n s -c o n t i n e n t a l s , the Canadian N a t i o n a l Railway and the Canadian P a c i f i c Railway. The Canadian N a t i o n a l i s an amalgamation of several p r i v a t e l y -owned l i n e s which ran i n t o f i n a n c i a l d i f f i c u l t i e s d u r i ng the war, n e c e s s i t a t i n g government i n t e r v e n t i o n . Between 1917 and 1923, these l i n e s were g r a d u a l l y brought under the c o n t r o l of the one government body, and, by Order i n C o u n c i l of January 30, 1923, the Act to i n c o r -porate the Canadian N a t i o n a l Railway Company was brought into e f f e c t . The Canadian P a c i f i c Railway i s a w e l l organized, e f f i c i e n t l y operated, and privately-owned system, running p a r e l l e l t o , and i n competition f r i t h the Canadian N a t i o n a l Railway. A recent development, designed to open up a new o u t l e t f o r Canadian wheat through the Hudson Bay and Hudson S t r a i t i s the Hudson Bay Railway. The main d i f f i c u l t y i n the use of t h i s route i s the very short p e r i o d during the year i n which the Hudson Bay i s navigable, due to i c e c o n d i t i o n s . * \ (114) I t has already he en pointed out that the Canadian railway system has he en one of the most important c o n t r i b u t i n g f a c t o r s to ' Canadian u n i t y . Before the opening of the Canal, i t was t h i s system which tr a n s p o r t e d goods from and to Vancouver over three thousand mil e s of d i f f i c u l t country to the A t l a n t i c seaboard. Prom the standpoint of time and cost, any a l t e r n a t i v e s to shipping goods over these l i n e s were almost p r o h i b i t i v e , I t i s true t h a t a small amount of trade took place from the A t l a n t i c coast, through the G u l f of Mexico, across the ol d Panama r a i l w a y , and up the P a c i f i c Coast to Vancouver (and v i c e versa) , hut the volume of t h i s t r a d e was very small indeed. Again, some trade from Europe came around Cape Horn, or across the P a c i f i c v i a the I n d i a n Ocean-Suez Canal route, hut i n a l l of these cases, time and distance were such formidahle obstacles that such shipping lanes could hardly he c l a s s e d as anything more than very minor f a c t o r s i n the Canadian d i s t r i b u t i v e system. With the opening of the Panama, Canal i n 1914, and i t s a c t i v e use by Canadian s h i p p i n g from 1921 on, the Canadian d i s t r i b u t i v e system underwent some d r a s t i c changes, both i n t e r n a l and e x t e r n a l . These changes were valuable i n some respects; i n others, l e s s so, I t i s common knowledge that r a i l w a y s the world over, operating on a competitive b a s i s , are actuated by two f o r c e s ; f i r s t , the law of Decreasing Costs, and, second, the p r i n c i p a l of "charging what the t r a f f i c w i l l bear," I n the f i e l d of r a i l w a y economics, the Law of Decreasing Costs » ., (115) i m p l i e s a l e s s than p r o p o r t i o n a l increase i n cost for each a d d i t i o n a l u n i t of goods c a r r i e d . V i r t u a l l y BB% of a r a i l w a y ' s expenses are » f i x e d charges, which do not vary w i t h the amount of t r a f f i c c a r r i e d . Therefore, a r a i l w a y company may, i n some cases, charge l e s s , and, i n others, more f o r s i m i l a r s e r v i c e s rendered, - depending e n t i r e l y on the amount of t r a f f i c which would move at a given r a t e . That r a t e would tend to s e t t l e at the po i n t which would move the most t r a f f i c at the g r e a t e s t p r o f i t . I n no case would i t go below the cost of moving the goods. One of the p r i n c i p a l f a c t o r s i n determining "what the t r a f f i c w i l l bear" i s the competition of o t h e r means of t r a n s p o r t a t i o n . In t h i s r e s p e c t , the Canadian rate s t r u c t u r e i s regulated, to a great ' extent, by the competition o f American t r a n s p o r t a t i o n f a c i l i t i e s . I n l i k e manner, Canadian l i n e s act as a governor on the American r a t e s t r u c t u r e . A l l other things being equal, any sh i p p e r , American or Canadian, w i l l seek out the cheapest t r a n s p o r t a t i o n s e r v i c e f o r h i s goods. A f t e r 1914, the Panama Canal became a new and potent f a c t o r i n the r a t e s t r u c t u r e s of both American and Canadian r a i l r o a d s , Undoubt-ed l y , any a l t e r n a t i v e t r a n s p o r t a t i o n system i n the form of a waterway holds a d i s t i n c t advantage, i n po i n t of cost, over a r a i l system. I n the f i r s t p lace, the waterway has not as heavy c a p i t a l charges to meet as t h e r a i l w a y , i . e . , cost of p l a n t and equipment; i n the second place;, the upkeep and overhead are not as high. In a d d i t i o n to those very important p o i n t s , water t r a n s p o r t a t i o n systems are much more f l e x i b l e * \ (116) t h a n r a i l w a y systems, T r a i n s must o p e r a t e between c e r t a i n f i x e r ! p o i n t s , and. t h e cargo must he assembled a t t h o s e p o i n t s f o r s h i p m e n t , whereas s h i p s can move ( w i t h i n r e a s o n a b l e bounds) t o p l a c e s where t h e r e i s c a r g o . As a consequence, the Panama Canal, v i e w e d as the c o n n e c t i n g l i n k i n P e . c i f i c - A t l a n t i c ocean r o u t e s , became a v e r y i m p o r t a n t c o m p e t i t i v e , f a c t o r i n the" r a t e s t r u c t u r e o f t h e N o r t h A m e r i c a n r a i l w a y systems. As f o r measuring- the a c t u a l e f f e c t of t h e Canal upon the r a i l w a y s of t h i s c o n t i n e n t , we a r e f a c e d h e r e w i t h a v e r y d i f f i c u l t P r o b l e m , Mr. Mears, commenting on t h i s p o i n t , s t a t e s , "There can he no q u e s t i o n t h a t the Panama r o u t e has d i v e r t e d an i m p o r t a n t volume o f tonnage from t r a n s c o n t i n e n t a l r a i I w a y s , h u t I t s h o u l d h e s t a t e d c l e a r l y and . f o r c e f u l l y t h a t I t has made p o s s i h l e t h e development o f an immense f l o w of t r a f f i c t h a t c o u l d not o t h e r w i s e have moved t o such d i s t a n t 1 m a r k e t s , " He g i v e s t h e f o l l o w i n g t a b l e as an i l l u s t r a t i o n o f the c o n d i t i o n s which e x i s t i n the U n i t e d S t a t e s , Comparative T r a n s c o n t i n e n t a l Tonnage, R a i l and C a n a l , * Commodity. Tons by R a i 1 . Tons t h r u C a n a l . Ammunition 24-5 567 C o t t o n p i e c e goods 3,271 10,925 Soda a l u m i n a s u l p h a t e 25 -L a r d and l a r d sub st i t u t e s 4,005 4,13.8 P a i n t 6,597 8,104 , R o o f i n g M a t e r i a l 5,845 4,541 R o s i n 6, 511 Soap 3,227 15,154 Soda 1,255 9,824 I r o n and S t e e l 156,085 779,369 P a p e r 14,918 25,194 T o t a l 195,471 861,907 2 * S e l e c t e d c o m m o d i t i e s moving June-November 1925* D a t a f r o m t h e I n t e r s t a t e Commerce Commission, F o u r t h S e c t i o n , A p p l i c a t i o n No. 12456, (1926) 1. Mears, op. c i t , , 126. 2, i b i d , , 138, (117) He concludes, "In any event, i t i s cl e a r t h a t the Panama route has 5 created a s e r i o u s problem of readjustment for Western r a i l r o a d s , " A s i m i l a r problem e x i s t s i n Canada. Bearing i n mind the f a c t that not a l l shipments v i a Panama would n e c e s s a r i l y have gone by r a i l had the canal not been there, the f i g u r e s f o r Vancouver and New Westminster exports and imports to and from Eastern Canada (1928-1934) give some i d e a of the t r a n s c o n t i n e n t a l t r a f f i c by water. TABLE 18 VANCOUVER AND HEW WESTMNSTEE WATER-BORNE EXPORTS AND EXPORTS TO At© FROM EASTERN CANADA i j n _ ^ o n g j -YEAR EXPORTS IMPORTS 1928 ' 22,066 30,615 1929 72,078 54,400 1930 70,340 33,772 1931 44,938 28,354 1932 33,991 19,836 1933 28,814 27,447 1934 32,763 61,392 Sources "A Study of the Canadian Railway Rate S t r u c t u r e and I t s Regional Influ.en.ee i n B r i t i s h Columbia", V i c t o r i a , February 1936, p.34 The above f i g u r e s , together w i t h those contained i n Table 16s. Page 105, are the only f i g u r e s a v a i l a b l e f or these two ports at the present time. The.greater impact of the canal has been f e l t i n the West of Canada, rather than the East. This i s best seen from the r e c o r d of t r a f f i c through the Panama Canal to and from the East and West Coasts of Canada, f o r the years 1921-1936, (See Table 19, Page 118.) In 1930, 5. Mears, op. c i t . , 158. ( l i e ) TABLE 19 TRAFFIC TO AND FROM THE EAST AND WEST COASTS OF CANADA VIA THE PABAMA CANAL, YEARS ENDED JUNE 50, 1921-1956 ' MIGINA^W"ON1 ' MismfETK}R7 YEAR WEST COAST EAST COAST WEST COAST EAST C.C 1921 125,638 39,561 126,414 16,558 180,981 25,174 148,505 6,521 1925 604,546 92,939 101,588 IS 5 ^ 283 13 1,223.102 110,677 141,086 197,204 19 (2 5 1,082,282 121,805 158,709 379,284 1926 1,650,855 160,196 168,295 614,580 1927 1,548,783 ,207,005 248,009 803,418 1928 2,845,675 168,287 268,960 394,173 1929 1 2, 650,646 231^1S8 ' 266,455 539,767 1950 17968,966 185,776 267,282 556,562 1951 2,307,257 137,756 271,621 492,532 1932 S j) 33 «3 $ S l l 89,445 167,655 529,517 15 5 *3 2,896,162 121,875 154,511 528,058 193.4 2,201,180 19 6,204 189,227 498,706 1935 2,490,205 248,658 176,698 547,974 1936 2,705,567 298,884 223,174 506,673 S o u r c e ; Canada Y e a r Book, 1937, p.700. , , (119) t r a f f i c o r i g i n a t i n g on t h e West Coast r e a c h e d i t s h i g h e s t l e v e l -2,968,966 t o n s , w h i l e t h a t o r i g i n a t i n g i n the E a s t r e a c h e d t h e 'peak i n 1936 - 298,884 t o n s . Over the whole p e r i o d , the tonnage of i m p o r t s E a s t and West has t e e n r e l a t i v e l y s n a i l , and i t i s q u i t e o b v i o u s , f r o m the f i g u r e s s u b m i t t e d , t h a t t h e y form a v e r y minor p r o p o r t i o n of Canadian t r a d e a f f e c t e d b y t h e c a n a l . I t has been s u g g e s t e d , w i t h a g r e a t d e a l o f t r u t h , t h a t .trade i s not t h e o n l y p a r t of t h e C a n a d i a n economic system to be a f f e c t e d by t h e c o n s t r u c t i o n o f t h e Panama C a n a l . Some v e r y marked changes i n wheat p r o d u c t i o n , w h i c h have t a k e n p l a c e s i n c e 1920, can be i n d i r e c t l y a t t r i b u t e d to the op e n i n g of t h i s waterway, and such changes ha.ve, i n t u r n , p r o f o u n d l y a f f e c t e d t h e Ca n a d i a n f r e i g h t r a t e s t r u c t u r e * Consequent t o a g r e a t d e a l o f a g i t a t i o n i n t h e West, Canadian f r e i g h t r a t e s on g r a i n were r a d i c a l l y r e v i s e d i n 1925, A t t h i s t i m e , the B o a r d of H a l l w a y Commissioners o r d e r e d t h e C a n a d i a n P a c i f i c and Canadian N a t i o n a l r a i l w a y s t o reduce r a t e s on g r a i n and f l o u r s h i p p e d t o P a c i f i c Coast p o r t s f o r e x p o r t , t o the l e v e l t h a t m a i n t a i n e d on such p r o d u c t s c a r r i e d E a s t . T h i s p l a c e d t h e Western s h i p p e r on an e q u a l f o o t i n g w i t h t h e E a s t by t h e a p p l i c a t i o n o f an eq u a l charge f o r e q u a l m i l e a g e on g r a i n moving out o f the coxmtry e i t h e r by t h e A t l a n t i c or P a c i f i G s e a b o a r d , t h u s r e d u c i n g t h e m a r k e t i n g c o s t s t o p r o d u c e r s i n t h e West, who were f o r m e r l y a t an i n c r e a s i n g d i s a d v a n t a g e as t h e d i s t a n c e of t h e i r farms from t h e A t l a n t i c i n c r e a s e d . Prom t h i s t i m e on, they were abl e t o t a k e advantage o f t h e s h o r t e r r a i l h a u l t o t h e P a c i f i c and s h i p < s ( 1 2 0 ) by Panama t o t h e European market. Such a r e d u c t i o n i n c o a t s tended t o a c c e n t u a t e t h e e f f e c t s of t h e p r e v a i l i n g : h i g h p r i c e of wheat i n w o r l d markets, w i t h a consequent increa.se i n p r o d u c t i o n i n t h o s e p r o v i n c e s most d i r e c t l y a f f e c t e d . T h i s w i l l be d e a l t w i t h i n the f o l l o w i n g c h a p t e r in-more d e t a i l , but the f o l l o w i n g f i g u r e s w i l l s e r v e at t h e p r e s e n t time- to i l l u s t r a t e . t h e p o i n t i n q u e s t i o n : TABLE 20 I B M ' PRODUCTION IN WESTERN CANADA BY PROVINCES, 1908-1952, ( M i l l i o n s o f B u s h e l s ) YEAR J ALBERTA SASKATCHEWAN MANITOBA 1909 6,8 34,7 50,5 1912 ,34,3 107.0 63.0 1917 52.9 117.9 41,0 1922 61.8 • 240.5 60.1 1927 , 171,0 - 252,5 30.8 1932 167,0 211,6 44.0 Sources D o m i n i o n Bureau o f S t a t i s t i c s , Canada Y e a r Book. Over t h e whole p e r i o d 1908-1932, t h e r e was a d e c i d e d s h i f t I n the c e n t e r o f g r a v i t y of wheat p r o d u c t i o n f r o m t h e p r o v i n c e of M a n i t o b a t o c e n t r a l Saskatchewan and A l b e r t a , a f a c t i n some c o n s i d e r a b l e degree a t t r i b u t a b l e to t h e open i n g o f t h e Panama C a n a l , I t may be s u r m i s e d t h a t such a change was bound t o have i t s * (121) e f f e c t on t h e w e s t e r n d i v i s i o n o f t h e Canadian r a i l w a y system. -With the i n c r e a s e i n s h i p m e n t s of C a n a d i a n wheat v i a P a c i f i c Coast t e r m i n a l s came -a v e r y r e a l p r o b l e m f o r the r a i l w a y s - t o c u t down t h e l o s s e s e n t a i l e d i n t r a n s f e r r i n g empty, c a r s from the c o a s t back t o t h e p r a i r i e s . Mr. H a r o l d I n n i s sums t h i s s i t u a t i o n up i n t h i s way; " I n A l b e r t a , e x p a n s i o n i n a c r e a g e and p r o d u c t i o n was more d i r e c t l y l i n k e d t o t h e e f f e c t s o f t h e c a n a l , and t h e s h i f t o f wheat movement to Vancouver has p o s s i b l y i n c r e a s e d c o s t s t h r o u g h t h e re-arrangement of t r a n s p o r t a t i o n 4 f a c i l i t i e s , p a r t i c u l a r l y i n h a n d l i n g empty c a r s , " Another problem w h i c h has been a c c e n t u a t e d by the c o n s t r u c t i o n o f t h e Panama C a n a l i s found i n t h e r e c e n t t r e n d f o r i n d u s t r i a l and m a n u f a c t u r i n g c e n t e r s t o c o n c e n t r a t e on t h e A t l a n t i c and P a c i f i c c o a s t s , r a t h e r t h a n i n i n l a n d c i t i e s . D u r i n g t h e p a s t t e n years,, t h e r e have been numerous i n s t a n c e s o f l a r g e i n d u s t r i a l c o r p o r a t i o n s opening b r a n c h f a c t o r i e s c l o s e t o t i d e w a t e r , b o t h i n Vancouver and i n t h e E a s t e r n c e n t e r s , T h i s p u t s the i n l a n d c i t i e s at a d e c i d e d d i s a d v a n t a g e , s i n c e t h e y must i n c l u d e i n t h e i r c o s t s o f m a r k e t i n g a l o n g , e x p e n s i v e r a i l h a u l . To q u o t e Mr. I n n i s a g a i n , "The advantage of i n l a n d c i t i e s w i t h 5 r e f e r e n c e t o the P a c i f i c market have been c o n v e r t e d i n t o p e n a l t i e s . " Such a t r e n d i n i n d u s t r y has l i k e w i s e p e n a l i z e d t h e r a i l w a y s , e i t h e r t h r o u g h t h e consequent l o s s o f t r a f f i c to and f r o m t h e s e i n l a n d c i t i e s , o r t h r o u g h f o r c i n g them t o c o - o p e r a t e w i t h the i n l a n d p r o d u c e r by r e d u c i n g r a t e s t o meet t h i s c o m p e t i t i o n . 4, I n n i s , H a r o l d A, Canada and t h e Panama C a n a l , p.1316. 5, i b i d , , 1307, < 1 (122) W h i l e t h e Panama C a n a l has had a t e n d e n c y to s h i f t c o n s i d e r a b l e p r o d u c t i o n t o t h e P a c i f i c c o a s t i n p r e f e r e n c e t o t h e E a s t c o a s t , the development o f t h e W e l l a n d C a n a l i n t h e S t , Lawrence b a s i n w i l l o f f s e t t h i s t o a c e r t a i n e x t e n t . I t w i l l u n d o u b t e d l y g i v e a g r e a t e r advantage t o t h e E a s t e r n p r o d u c e r , who i s a l r e a d y s t r o n g l y e n t r e n c h e d , and thus c o x i n t e r b a l a n c e t h e e f f e c t o f t h e Panama. Canal and keep C a n a d i a n p r o d u c -t i o n c e n t e r e d i n O n t a r i o and t h e E a s t e r n p r o v i n c e s . I n our e x a m i n a t i o n o f t h e Canadian e x t e r n a l d i s t r i b u t i v e system, i . e . , t h e t r a n s p o r t a t i o n r o u t e s connecting; t h i s c o u n t r y w i t h w o r l d m a r k e t s , we a r e c h i e f l y c o ncerned i n t h i s s t u d y w i t h the developments i n t h e Yfest s i n c e 1921, r a t h e r t h a n i n t h e E a s t , Some of the r e s u l t s o f t h e opening o f t h e Panama C a n a l a r e q u i t e o b v i o u s , and t h e y a r e i m m e d i a t e l y a s s o c i a t e d w i t h t h e B r i t i s h C o l u m b i a c o a s t , and more p a r t i c u l a r l y w i t h t h e P o r t o f Vancouver, - . The most d i r e c t and e a s i l y measured e f f e c t o f t h i s new highway on Vancouver and i t s h i n t e r l a n d , W e s t e r n Canada, has been t h e s a v i n g i n time and d i s t a n c e by w a t e r t o t h e i m p o r t a n t t r end ing c e n t e r s o f the w o r l d . T h i s s a v i n g i s i l l u s t r a t e d t o advantage by Table 21, Page 125. I t i s . q u i t e a pparent t h a t , b e f o r e 1921, Vancouver was at a g r e a t d i s a d v a n t a g e i n competing f o r t r a d e i n w o r l d markets. A s a v i n g o f some '20 days and ov e r 4000 m i l e s i n t h e t r i p f rom Vancouver t o t h e M e d i t e r r a n e a n i s a good i n d i c a t i o n o f why e x p o r t s f r o m t h i s p o r t i n c r e a s e d so r a p i d l y a f t e r the opening of t h e c a n a l . S i m i l a r l y , a s a v i n g o f 25.1 days and 5,666 m i l e s t o L i v e r p o o l shows how much c l o s e r Vancouver has become t o t h e (123) I ABIE 21 TABLE OP DISTANCES FROM VANCOUVER, B.C., TO ATLANTIC AND EUROPEAN PORTS. (VIA PANAMA CANAL.) MILES VIA IHLBS VIA SAVING SAVING FROM VANCOUVER TO - MAGELLAN PANAMA IN MILES IN DAYS Boston 13,876 6, 200 7,676 „ New York 13, 905 6,032 7„873 • 3 2 © 3 Charleston 13,856 5,622 8,234 35,8 New Orleans 14,321 5,453 . \ 8,868 56.4 L i v e r p o o l 14,272 8,606 5,666 23.1 Hamburg 14,653 9 p 125 5,528 22.5 Bordeaux 14,052 8,556 5,376 21.9 G i b r a l t a r 13,341 8,391 4,950 SO « X Notes The sa v i n g time of t e n knots. i n days i s computed i n the b a s i s of ves s e l s Souroer Annual Report 1920, p.26. of the Harbor Commissioners of Vancouver, B.i i (124) U n i t e d Kingdom market, and a c c o u n t s i n l a r g e measure f o r t h e i n c r e a s e d t r a d e w i t h t h e O l d C o u n t r y . • R e f e r r i n g hack t o an e a r l i e r c h a p t e r , i n w h i c h th*e h i s t o r y of C a n a d i a n t a r i f f r e l a t i o n s was r e v i e w e d (Pages 4 4 - 4 6 ), an obvious g a i n to B r i t i s h C olumbia becomes e v i d e n t as a r e s u l t of t h e Panama r o u t e . As e a r l y a s 1912, the D o minion government e n t e r e d i n t o a t r a d e agreement w i t h t h e "*est I n d i e s , and t h i s t r e a t y was e x t e n d e d and b r o a d e n e d i n 1920 and 192V, W h i l e no t r a d e f i g u r e s a r e a v a i l a b l e p r i o r t o 1920, i t i s e a s i l y s e e n t h a t b e f o r e the o p e n i n g o f the c a n a l , ' B r i t i s h Columbia c o u l d p a r t i c i p a t e i n t h a t t r a d e o n l y u n d e r the g r e a t e s t 1 hand l e a p s , S i n c e 1921', a v e r y p r o f i t a b l e t r a d e has grown up between the two; b o t h I m ports and e x p o r t s have i n c r e a s e d v e r y r a p i d l y , r e a c h i n g 35,000 t o n s and 3 8 , 0 0 0 t o n s r e s p e c t i v e l y , f o r t h e P o r t o f V a n c o u v e r a l o n e , f o r a s i n g l e y e a r . (See T a h l e 16, p. 105.) I h e C a n a d i a n f e d e r a l government e n t e r e d i n t o t r e a t i e s w i t h the U n i t e d Kingdom i n 1919, and a g a i n a t t h e I m p e r i a l C o n f e r e n c e i n 1952. Such t r a d e agreements pr o v e d most v a l u a b l e t o W e s t e r n Canada, and p a r t i c u l a r l y t h e p r o v i n c e s f o r m e r l y at a d i s a d v a n t a g e i n r e s p e c t o f d i s t a n c e from t h e Old C o u n t r y . The t a b l e c i t e d a.bove shows t h a t e x p o r t s from Vancouver t o Great B r i t a i n r o s e from 52,945 to n s . i n 1921 t o 1,803,000 t o n s i n 1932, w h i l e i m p o r t s i n c r e a s e d f r o m 15,892 t o n s I n • 1921 t o the h i g h f i g u r e o f 90,504 t o n s i n 1929, The e f f e c t s of o t h e r t r a d e agreements between t h e Dominion government and f o r e i g n powers, e.g., P r a n c e , P o l a n d , South A f r i c a , and B r a z i l , a r e r e f l e c t e d i n t h e f i g u r e s f o r t h e s e v e r a l t r a d i n g - a r e a s i l l u s t r a t e d i n T a b l e 16. From a study of Vancouver f i g u r e s b y t r a d i n g a r e a s , one i s a b l e t o a r r i v e a t f a i r l y c o n c r e t e c o n c l u s i o n s a s t o t h e e f f e c t on B r i t i s h Columbia and W e s t e r n Canada of t h e o p e n i n g o f t h e c a n a l . I t i s customary i n t h e West t o s t r e s s t h e advantages which t h e Panama C a n a l has b r o u g h t to Western t r a d e ; n e v e r t h e l e s s , one should remember t h a t i t has a l s o been of advantage to E a s t e r n t r a d e , perhaps even to t h e u l t i m a t e d i s a d v a n t a g e o f t h e West. P r i o r t o the o p e n i n g o f the Panama C a n a l , E a s t e r n p r o d u c e r s had f o u r r e l a t i v e l y e x p e n s i v e c h a n n e l s t h r o u g h which to s h i p t h e i r goods t o A u s t r a l a s i a and the O r i e n t . These r o u t e s were; (1) a c r o s s the N o r t h A t l a n t i c Ocean and t h r o u g h t h e Sues C a n a l ; (2) a c r o s s t h e South A t l a n t i c v i a the Cape of Good Hope; (3) south and w e s t v i a t h e S t r a i t s o f M a g e l l a n and" (4) h y r a i l a c r o s s Canada t o Vancouver, and t i i e n c e by steamer o v e r the P a c i f i c . W i t h t h e o p e n i n g o f the Panama C a n a l , t h e E a s t s u d d e n l y became independent o f the l o n g , e x p e n s i v e r a i l h a u l a c r o s s Canada, and-c o u l d s h i p d i r e c t wi t h out i n c u r r i n g t h e heavy c o s t s o f t r a n s h i p m e n t a t Vancouver. Mr. I n n i s goes s o f a r as t o say t h a t , but f o r wheat shipments t h r o u g h Vancouver, t h e l a t t e r a c t u a l l y l o s t more t r a d e t o t h e E a s t t h a n i t g a i n e d * As a n o t h e r p o i n t i n f a c t , t h e p o r t o f Vancouver w i l l undoubted-l y l o s e a c o n s i d e r a b l e volume o f s i l k s h i p m e n t s from Japan as a r e s u l t of the o p e n i n g o f the c a n a l . The Japanese a r e a l r e a d y c o n s i d e r i n g the . , ( 1 2 6 ) c o n s t r u c t ! o n o f f a s t e r f r e i g h t e r s i n w h i c h t o s h i p t h e i r s i l k d i r e c t t o t h e European market, i n p r e f e r e n c e to t h e o c e a n - r a i l ~ o c e a n r o u t e t h r o u g h Vancouver now i n use. C o n s e q u e n t l y , one may presume t h a t t h e new waterway i s not e n t i r e l y a. pot o f g o l d a t the end of .the r a i n b o w f o r Canada's P a c i f i c p o r t s . One o f t h e most d i s t u r b i n g f a c t o r s i n Canada's e x t e r n a l d i s t r i b u t i v e s y s t e m i s t h e empty tonnage problem a r i s i n g out of t h e e x c e s s o f e x p o r t s t o the P a c i f i c c o a s t over i m p o r t s f r o m t h i s r e g i o n . E x p o r t s from t h e P a c i f i c a r e l a r g e l y b u l k y , p r i m a r y p r o d u c t s , e.g. , wlieat and lumber, c a r g o e s which t a k e a g r e a t d e a l , o f space, y e t w h i c h w i l l o n l y move on a low r a t e s c h e d u l e . I m p o r t s , on t h e o t h e r hand, com p r i s e i n l a r g e p a r t much-less b u l k y , m a n u f a c t u r e d goods, w h i c h can c a r r y a h i g h e r r a t e charge. S i n c e e x p o r t s f r o m t h e P a c i f i c f a r exceed t h e i m p o r t s , b o t h i n t o n n a g e and v a l u e , s h i p s coming out t o Vancouver t r a v e l l i g h t , and the consequent waste space must be borne out o f the p r o f i t s o f t h e round t r i p s U n d e r t h e c i r c u m s t a n c e s , b o t h i m p o r t s and e x p o r t s must s t a n d t h i s l o s s i n h i g h e r f r e i g h t r a t e s , a f a c t w h i c h l a y s a b u r d e n on P a c i f i c c o a s t t r a d e not e n c o u n t e r e d i n o t h e r w o r I d t r a d e r o u t e s . To a c e r t a i n e x t e n t , t h i s f a c t o r I s o f f s e t by c a r g o e s d e s t i n e d f o r more p o p u l o u s A m e r i c a n P a c i f i c c o a s t p o r t s ; n e v e r t h e l e s s , i t s t i l l has a d i s t u r b i n g i n f l u e n c e on t h e s c a l e o f ocean f r e i g h t r a t e s to and f r o m C anadian p o r t s . The Panama C a n a l has c o n s i d e r a b l y a f f e c t e d a l l w o r l d s h i p p i n g r o u t e s , and, i n t h i s way, has had i t s i n f l u e n c e on t h o s e l a n e s emanating . , (127) from B r i t i s h . Columbia p o r t s . Probably the most important r o u t i n g f a c t o r i n sea t r a f f i c i s that of time, and we have seen how important i t i s i n Vancouver's t r a d e . Johnson and Huebner hold that "no routing - considera-t i o n i s more important than t h i s r e d u c t i o n i n time, f o r from i t r e s u l t more' frequent steamship s e r v i c e s , more r a p i d d e l i v e r y , and a r e d u c t i o n 6 i n operating c o s t s . " I n a d d i t i o n to the time f a c t o r , there are other elements which determine the common channels of shiprjing, and some of these are to be found on the P a c i f i c coast of North America. .For example, i t i s p o s s i b l e to ob t a i n cheaper f u e l at American s t a t i o n s due t o a plen-t i f u l supply of o i l i n C a l i f o r n i a . Undoubtedly, " i n so far as the canal encourages the establishment of d i r e c t steamship l i n e s , i t w i l l discourage • 7 i n d i r e c t shipments and the transhipment i n c i d e n t to them." B r i t i s h Columbia ports have a p a r t i c u l a r i n t e r e s t i n the d i r e c t i o n and the volume of tra.de which passes over two of the major-shipping routes through the Panama Canal. An Azmuth chart shows the port of Vancouver as not f a r removed ,from the sho r t e s t route between the A t l a n t i c and the Orient. Ships coming through the canal t r a v e l up the-.coast of the United Sta.tes i n a great c i r c l e , and break away from the North American continent not f a r below the 49th p a r a l l e l . On the other hand, vessels l e a v i n g B r i t i s h Columbia, loaded f o r Europe, t r a v e l down the P a c i f i c coast, through the c a n a l , and then t u r n north i n the A t l a n t i c and pass w i t h i n a few hundred miles of New York i n n a v i g a t i n g the sh o r t e s t route to the Continent. Johnson and Huebner estimate that 6. Johnson & Huebner, op. c i t . . 88. 7« x b i d . , 92. '• • (128) "the route from Great - B r i t a i n to the Panama Canal v i a Hew Y o r k i s 8 o n l y 323 m i l e s longer t h a n t h e most d i r e c t r o u t e , " In as ranch as " t h e r o u t e s f o l l o w e d "by ocean s h i p s a r e d e t e r m i n e d by t h e l o c a t i o n . and t r a f f i c Importance o f t h e a r e a s between w h i c h t r a d e i s being-c a r r i e d on, by the s p herIty of the e a r t h , by the s i z e of t h e l a n d masses l y i n g between t h e t r a d i n g a r e a s , and by t h e l o c a t i o n o f f u e l 9 s t a t i o n s and the cost" of c o a l or f u e l o i l " , i t i s apparent t h a t Vancouver and i t s t r i b u t a r y a r e a s are p a r t i c u l a r l y w e l l s i t u a t e d to share i n any future development on t h e s e routes consequent to the increased use of the Panama C a n a l . 8 a J o h n s o n & Huebner, op, c i t , , 60. 9, i b i d , , 59, CHAPTER I S One of the most s i g n i f i c a n t f eatures i n the h i s t o r y of Canadian economic development during the Twentieth Century lias been the growth i n importance to the vhole Dominion of the Western Canadian wheat crop. More important to Canada than any other product of economic a c t i v i t y , i t surpasses i n value any other s i n g l e item of our i n t e r n a l or e x t e r n a l trade, and the s i z e of the crop and i t s value i n world markets p l a y s a s i g n i f i c a n t p a r t i n s e t t i n g the standard of l i v i n g f o r the ten m i l l i o n odd i n h a b i t a n t s of the Dominion. Canadian purchasing power depends l a r g e l y on the a b i l i t y o f the Western farmer to dispose of h i s wheat i n w o r l d markets at a good p r i c e . Consequently, experience has shown t h a t , i n p e r i o d s of r i s i n g world p r i c e s f o r g r a i n , Canadian purchasing power increases, imports r i s e , unemployment f i g u r e s d e c l i n e , and p r o s p e r i t y i s evident on a l l sides, I n those years when the p r i c e of wheat f a l l s , imports d e c l i n e , purchasing power s h r i n k s , unemployment f i g u r e s r i s e , and business depression sets i n . I t i s g e n e r a l l y agreed that the Panama Canal has had a g r e a t e r e f f e c t on Canadian g r a i n than upon any other s i n g l e f a c e t of Canadian l i f e . Aside e n t i r e l y from the changes d i r e c t l y brought about In other areas of our n a t i o n a l l i f e by the opening of the Canal, i t i s becoming I n c r e a s i n g l y evident that such changes i n the wheat trade, which have r e s u l t e d since 1921, have i n themselves brought about a l t e r a t i o n s f a r -reaching i n t h e i r s i g n i f i c a n c e upon the economy of Western Canada, Out of such a l t e r a t i o n s , t h ere has evolved a s e r i e s of new problems p e c u l i a r ' i (130) i n themselves to the g r a i n trade, and demanding s o l u t i o n before the f u l l advantages of the Canal can be u t i l i s e d . The major wheat markets of the world are located i n Europe, v i z . , Germany, Belgium, Prance, Great B r i t a i n and Northern I r e l a n d , I r i s h Eree S t a t e , I t a l y , the Netherlands,, Sweden, S w i t z e r l a n d , and Czechoslovakia; these c o u n t r i e s together imported 81% of the t o t a l world wheat imports i n 1933-34, 74% i n 1934-35, and 74%* i n 1935-36. (See Table 22, Page 131.) I n other words, over 75% of the world *s market f o r imported wheat was l o c a t e d i n Europe during t h i s p e r i o d . S i m i l a r l y , f l o u r i s imported by European natio n s i n l a r g e q u a n t i t i e s ; European im-po r t s o f f l o u r were 75% of the world t o t a l i n 1953-34, 70% i n 1934-35, and 69% i n 1935-56. The Canadian c r o p . i s the nearest of a l l the great wheat crops to t h i s huge msrket, and Canadian shippers have a tremendous advantage, i n time and d i s t a n c e alone, over A u s t r a l i a , Argentina, and the other wheat-producing c o u n t r i e s . The supply of t h i s market w i t h wheat has been shared i n the past few years by f i v e leading g r a i n exporting c o u n t r i e s - the United S t a t e s , Canada, Argentina, A u s t r a l i a , and Hungary, (See Tahle 23, Page 132.) I t w i l l be noted from the t a h l e t h a t , i n the Case of f l o u r exports, Argentina and Hungary do not rank very high i n the trade, the bulk of i t being shared; 'between the United States, Canada, and- A u s t r a l i a , w i t h Yugoslavia a poor f o u r t h . The f o l l o w i n g t a h l e .gives the percentage of wheat and f 1 our (131) TABLE 22 THE IMPORTS OP PRINCIPAL WHEAT IMPORTING COUNTRIES. WHEAT (Thousands of B u s h e l s ) 1933-34 1954-55 1955-36 Germany 28,579 11,806 3,564 B e l g i u m 44,841 42, 416 40,531 F r a n c e 27 , 208 25,463 26,760 Gr e a t B r i t a i n & N o r t h e r n I r e l a n d 200,103 188,628 190,664 I r i s h F r e e S t a t e 17, 133 15,700 14,598 I t a l y 16,795 20,587 N e t h e r l a n d s 22, 748 18,669 18,945 Sweden 1,815 1,503 1,685 S w i t z e r l a n d 17,596 17,916 16,670 C z e c h o s l o v a k i a 147 1,415 2 ^ 15 V Jap an 15,351 18,129 12,805 Other C o u n t r i e s 73,860 99,697 99,565 T o t a l 467,176 461,929 427,742 FLOUR (Thotisand s of B a r r e l s ) 1955-54 1954-35 1935-36 Germany 28 37 16 A u s t r i a 506 595 382 Denmark 296 242 111 F i n l a n d 585 453 351 Great B r i t a i n & N o r t h e r n I r e l a n d 5,967 4, 644 4,861 I r i s h F r e e S t a t e 55 7 2 S9 81 Norway 475 509 456 N e t h e r l a n d s 449 463 615 C z e c h o s l o v a k i a 11 10 12 E g y p t 47 55 35 Other C o u n t r i e s 3 j, 270. 3 a 53 7 2,712 T o t a l 1 2 1 9 1 10,374 9 y 632 Sources Canada Y e a r Book, 1936, p,276 Canada Y e a r Book, 1937, p.281 (132) TABLE 23 THE EXPORTS OF WHEAT AND FLOUR FROM THE PRINCIPAL WHEAT EXPORTING COUNTRIES, WHEAT (Thousands of Bushels) 1933-34 1934-35 1955-36 Uni t e d States 19,624 2,436 272 Canada 170,234 144,375 232,020 Argentina 141,281 176,429 65,513 A u s t r a l i a 60,148 74,871 73,225 Hungary 25 «i 8 27 10,873 13,606 Bulgar i a 3,333 •• 367 1,139 Y u g o s l a v i a S 22 4,167 614 Other Countrie s 86,860 80,895 87,887 To t a l .494,415 474,276 FLOUR (Thousands of B a r r e l s ) 19 53-34 1954-55 19 35-56 United States 5,868 3,896 3,435 Canada 5,455 4,750 4,979 Argentina ,1,249 1,088 896 A u s t r a l i a 5,572 7 rj 6,198 Hungary 153 157 206 Bulgar i a 748 415 637 Yugoslavia, . 2,841 3,675 1,881 Other Countries 9,872 7,748 5,638 T o t a l 29 p 7 c)9 29,062 23,870 Source; Canada Year Book, 1936, p.276. Canada Year Book, 1937, p.281. (133) w hich t h e s e c o u n t r i e s e x p o r t e d r e s p e c t i v e l y , i n r e l a t i o n t o t o t a l w o r l d e x p o r t s : -W H E A T 1935-34 1934-35 1935-36 U n i t e d S t a t e s 4% Canada 33 29% 4 9 % A r g e n t i n a . 28 36 14 A u s t r a l i a 12 15 • 15 Hungary 5 2 3 Y u g o s l a v i a -_ _ F L O U R 1935-34 1954-55 1955-36 15% 14% 15%' 17 17 21 3 3 4 20 24 25 10 14 8 Canada, A u s t r a l i a , and A r g e n t i n a were the major w h e a t - e x p o r t i n g c o u n t r i e s , w h i l e t h e U n i t e d S t a t e s , Canada, A u s t r a l i a , and Y u g o s l a v i a l e d the way i n f l o u r e x p o r t s , A g l a n c e at a g l o b e w i l l show the o u t s t a n d i n g advantage t h a t Canada h o l d s over her c o m p e t i t o r s i n p o i n t of v i e w of d i s t a n c e f r o m t h e European m a r k e t , M o n t r e a l i s o n l y 5200 m i l e s f r o m L i v e r p o o l , w h i l e Buenos A i r e s I s 7200 m i l e s away, and M e l b o u r n e , by the s h o r t e s t r o u t e , i s w e l l over 10,000 m i l e s d i s t a n t . W h i l e Canada i s so s i t u a t e d g e o g r a p h i c a l l y as to have a d i s t i n c t a d v a n t a g e over h e r two g r e a t e s t r i v a l s i n . t h e w o r l d ' s wheat m a r k e t , i t can r e a d i l y be s e e n t h a t any change f o r the b e t t e r i n her i n t e r n a l or e x t e r n a l t r a n s p o r t a t i o n system w o u l d add m a t e r i a l l y t o t h i s a dvantage. The Panama Ca n a l p e r f o r m e d j u s t t h i s f u n c t i o n , a f a c t w h i c h w i l l become more and more e v i d e n t as time goes on. A c l o s e r e x a m i n a t i o n o f C a n a d i a n wheat p r o d u c t i o n r e v e a l s the " (134) f a c t t h a t , p r i o r t o 1920, A l b e r t a , of the t h r e e W e s t e r n p r o v i n c e s , ws,s a t the g r e a t e s t d i s a d v a n t a g e i n r e s p e c t t o time and d i s t a n c e from t h e European market, To use a v e r y f a m i l i a r economic t e r m , -one might c a l l A l b e r t a d u r i n g t h i s time t h e " m a r g i n a l " wheat-producing a r e a of Canada i n p o i n t of t i m e and d i s t a n c e f r o m t h e u l t i m a t e market. The e f f e c t of t h i s d i s a b i l i t y i s e v i d e n t i n t h e f i g u r e s f o r p r o v i n c i a l , wheat produc-t i o n ( T a b l e 24, Page 135} f o r t h e y e a r s 1915-1935, Two c h a r a c t e r i s t i c s a re not i c e able i n A l b e r t a p r o d u c t i o n from 1915 t o 1920, i n f a c t r i g h t up t o 1922, I n the f i r s t p l a c e , t h e p e r c e n t a g e t h a t t h e A l b e r t a c r o p s b e a r to t o t a l W e s t e r n p r o d u c t i o n i s c o n s i s t e n t l y low. Second, t h i s p e r c e n t a g e f l u c t u a t e s a. g r e a t d e a l f r o m y e a r to y e a r . I t w i l l be r e c a l l e d t h a t s i m i l a r c h a r a c t e r i s t i c s were e v i d e n t in-the g e n e r a l t r a d e t r e n d of A l b e r t a , a s d i s c u s s e d i n a n e a r l i e r chapter,, and t h a t the cause was t h a t the p r o v i n c e was s t i l l i n t h e development s t a g e , l a b o r i n g under t h e d i s a d v a n t a g e of Inadequate t r a n s y o r t a t i o n , W i t h the opening o f t h e Panama C a n a l , A l b e r t a ceased' to he the m a r g i n a l p r o v i n c e by v i r t u e of i t s c l o s e r end cheaper means of c o m m unication w i t h Europe, and M a n i t o b a , i n t u r n , became t h e p r o v i n c e most handicapped b y t h e element of t i m e and d i s t a n c e from t h e u l t i m a t e market, P r o d u c t i o n f i g u r e s f o r t h e t h r e e W e s t e r n p r o v i n c e s I l l u s t r a t e t h i s s t a t e o f a f f a i r s t o advantage, and the diagrams on Pages 156-157 ( F i g u r e s 39 and 40) show even more f o r c e f u l l y t h e change t h a t t o o k p l a c e . A f t e r 1922, A l b e r t a p r o d u c t i o n composed a l a r g e r p r o p o r t i o n o f the t o t a l t h a n e v e r b e f o r e , w h i l e t h a t o f M a n i t o b a f e l l o f f . 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O m i o « > ' y | t o a ) c o o > M t o a ) o B o 5 H N < j i © r l i H M M M H H H r-l ^ r-l r-l r - | i H r - ! CM CM' LO j> as to r-l CM r-l to a> LO © « « 3 * a e © to r-l <Ji o LQ c- LO O to to to CO CO o ID as rH a> rH to CM LQ. a> CM CM LO to to CO tO LO in in to cn LO to to CO O to I s in t - ^< LO ^ o o > H i 0 i O r H i o o ^ < o « ) to > o r-i ^  m o n ID CMtOCM CM CMtOCMr-rltOCM C M C M t O O J c O t O L O C O t O ^ t Q to to CO !>- r-l £- CT. 01 CM to OS O to CO to LO O rH CM « a a « « *> a m ft o o CM CM tt' o CM CM rH co CM !>- en CO o CO CT- CM to IS- in o> rH rH to r-l CO to to CO o» t» m. to LO CO O O r-l r-i r-l rH CM rH rH CM rH rH rH CM CM rH CM CM CM rH CM CM t O ^ W t D C O l O O O I O i O I O W M N H O O M O O H L O L O ^ ^ - ^ ^ t O t O l D ^ L O l O L O L n L O L O ^ ^ ^ I ^ L O in tO JS- CO 0* o rH CM to LQ to !>- CO Oi o rH CM to LO rH r-I r—1 rH rH CM CM Ol CM CM CM CM Ol CM CM to to to to to to cn o> OS 01 cn 01 OJ 0> 05 0J 05. 0J 0> OJ 0^ 0 i 0a 01 cn OS rH r-l rH H r-l rH rH rH i-H rH rH rH rH r-l rH r—! rH rH rH rH r-l rH to CM rH CM IN- O in m rH CO CM O o» to CM cn to CO CM CM m r-l e- © e » o © © © © IS © © © © « © © 6 « rH cS 04 rH tO CO to in CM o CO t~ o 0i CO to CM CM LO m -p J>- CM LO rH i—1 to IS- in rH LO in LO to !>- to rH CM 01 Ol • o co to CM CM CM CM to in CM to to LO CM to CM to CM r-l CM w & W u o O to CM rH !> 01 01 LO m o cn CM CM 10 01 03 tO t~ £-01 rH CM to CM r-l rH CM rH to rH CM rH rH rH rH rH r-l r-l rH o CD rSA CO MUcs5 o 05 to 0» o CO in CO o CM LO LO CM o is. in t - to f—I 13 © » © *> © © © © © 9 # 0 © e o © © o CM CM 0> in rH o 01 to m o 0s CC) 01 rH 01 CM CO •H CO OS O to rH rH rH CM LO CM LO 01 to 01 to o CO rH O rH rH rH rH rH rH rH rH rH rH rH rH rH rH rH 5-. (156) (137) (138) The p r e s e n t p o s i t i o n o f M a n i t o b a as t h e m a r g i n a l producinsj a r e a of Canada has been a l l e v i a t e d t o a, c e r t a i n e x t e n t by t h e new o u t l e t t o Eu r o p e v i a t h e Hudson Bay, The v a l u e of t h i s r o u t e i s , however, l i m i t e d by t h e f a c t t h a t t h e Hudson Bay i s c l o s e d t o n a v i g a t i o n by i c e f o r t h e g r e a t e r p a r t o f the y e a r , I t s v a l u e has not been de m o n s t r a t e d so f a x , and M a n i t o b a s t i l l h o l d s t h e p o s i t i o n f o r m e r l y o c c u p i e d by A l b e r t a and B r i t i s h C o l u m b i a , and a g i t a t e s s t r o n g l y f o r cheaper f r e i g h t r a t e s t o o f f s e t t h e d i s a d v a n t a g e s of i t s g e o g r a p h i c p o s i t i o n . There l i s one a r e a i n Canada w h i c h , up t o t h e pre s e n t t i m e , might he c l a s s e d a s a s u b - m a r g i n a l w h e a t - p r o d u c i n g a r e a - t h e Peace R i v e r D i s t r i c t , a v e r y f e r t i l e r e g i o n s i t u a t e d i n n o r t h e r n A l b e r t a and B r i t i s h C olumbia. So f a r , t h e c o s t s of s h i p p i n g ' wheat f r o m t h e Peace R i v e r have b e e n such as t o l i m i t i t s development, and, w h i l e wheat of a v e r y h i g h q u a l i t y Is grown t h e r e , 20 m i l l i o n a c r e s o f l a n d s t i l l r e m a i n In a v i r g i n s t a t e . Only adequate a n d economic t r a n s p o r t a t i o n f a c i l i t i e s a r e needed t o put i t on a p r o d u c t i o n b a s i s . The l o g i c a l o u t l e t f o r g r a i n f r o m t h e ' P e a c e R i v e r Is west t h r o u g h B r i t i s h Columbia t o t h e P a c i f i c , and t h e n c e v i a Panama to -Europe. S h o u l d t h i s o u t l e t be c o m p l e t e d (and i t can be by e x t e n d i n g the P a c i f i c Great E a s t e r n R a i l w a y n o r t h f r o m t h e p r e s e n t r a i l h e a d ) , the Peace R i v e r D i s t r i c t w i l l become one of t h e p r e f e r r e d v/heat-producing a r e a s of Canada. By comparison w i t h t h e p r o v i n c e s f u r t h e r e a s t , i t would have a r e l a t i v e l y s h o r t r a i l h a u l , h a r b o r s w i t h t w e l v e months' n a v i g a t i o n , and a cheap r o u t e Use) "by s e a t o t h e market. The Panama Canal, has made p r o d u c t i o n of wheat i n t h e Pea.ce R i v e r a p r a c t i c a l p o s s i b i l i t y f o r the near f u t u r e . T h i s b r i n g s t i s now t o a d i s c u s s i o n of t h e problems of m a r k e t i n g t h e W e s t e r n C a n a d i a n wheat c r o p . T h i s c r o p f l o w s to t h e E u r o p e a n market i n one of f o u r ways - n o r t h - e a s t by way o f M a n i t o b a p o r t s on t h e Hudson Bay, e a s t t h r o u g h C a n a d i a n p o r t s , e a s t t h r o u g h A m e r i c a n p o r t s , or west t h r o u g h P a c i f i c C o a s t p o r t s . The problem i s t o a n a l y z e the e f f e c t t h e Panama Canal has had on the f l o w o f g r a i n through t h e s e v a r i o u s c h a n n e l s . We have s e e n t h a t t h e r e was a d e f i n i t e r e l a t i o n s h i p between the development o f A l b e r t a g r a i n p r o d u c t i o n and the o p e n i n g of the Panama C a n a l , Boes g r a i n p r o d u c t i o n i n t h e p r a i r i e p r o v i n c e s i n any way a f f e c t the f l o w o f t h a t commodity t h r o u g h P a c i f i c p o r t s t o t h e C a n a l ? What e f f e c t , i f any, do c r o p c o n d i t i o n s i n A l b e r t a , Saskatchewan, or M a n i t o b a he.ve on P a c i f i c C o a s t e x p o r t s of wheat? T a b l e s 25 and 26 (Pages 140-141) and f i g u r e s 4 1 , 32, 43, and 44 (Pages 142-144) g i v e the f a c t s from w h i c h to draw our c o n c l u s i o n s . U n f o r -t u n a t e l y , g r a i n e x p o r t s r o u t e d t h r o u g h Panama, f r o m t h e whole Canadian P a c i f i c s eaboard a r e not a v a i l a b l e , b u t P o r t of Vancouver f i g u r e s g i v e an a c c u r a t e i n d i c a t i o n o f the t r e n d , and must he s u f f i c i e n t f o r our p u r p o s e , The f i g u r e s f o r Vancouver g r a i n . e x p o r t s appear i n T a h l e 25, Page 140; t h o s e f o r p r o v i n c i a l c r o p s have b e e n p r e v i o u s l y s u b m i t t e d (Table 24, Page 135). I n t h e diagrams on Pages 142-144, t h e graphs? have "been s y n c h r o n i z e d , i n o r d e r t o compare t h e v a r i o u s c r o p t o t a l s , and t h e volume o f e x p o r t s from t h e P o r t of Vancouver, I t w i l l be n o t i c e d t h a t Vancouver e x p o r t s appear (140) to CM O H w o M & . O tO ft| cn. CO r-l S3 I O CM cn H E< i CO Bs co j—-i m fit P4 O Q P i CQ O I s -m w as ' x! CO o tn Pi o . H C I ID to to to to cn CM to 0> co en •O to cn cn CM cn r-i 00 CM cn E-ca cn rH tO CM cn rH LO cn CM cn •-I era CM cn CM CM cn r-i CM cn O CM cn r-l ID tO r-l cn r-i CQ o CM cn cn to C- CM . . . . . . . . . . * « « in t - to •^i to to to CO ID CM rH tO CM to t o <M r—1 CO CM r - i N CO o> in >=# CO CM r-l «Jt rH r-i W M3 H tO O tO to rH E- E- - rH tra » * ft a o . . . tn co to o to to CM co era o co tn CM t> CO H r-f tO £>- to in M r ! t | rH rH to cn o tO IO r-i O CM cn t- to ID to « 0 . . . . M N tO r-i o in o M to 00 CO to i>- to c- o cu O to to « H r-i rH rH rH O «3 O O cn r-i co to cn tra cn . . . © « 9 . « . . . e .© « cn tra in co co O E- CM to rH CM CM O tO r-i CM to co w to cn tra t> H lO r-i r-i rH rH rH co ^ tra to to to t o <^ fr <-H 0.! rH CO o . . . « 9 O © . . . © CM t - CM LO H^ rH tO IO rH LO cn O rH rH co cn cn to r>- tra o tO rH rH rH «-o cn co era CM tn CO H T | N m rH . . . . e . . e » r- » 00 tO a * tra ts CM tn CM CM CO cn co co r-i CO <4: fc~ co cn CO rH to «4< r-i rH rH O CM O o o o o to cn cn o o . . . « . . . to cn to *i< O £- "i* *r}< co m 00 CM to 03 E- tO cn b - CM to E«- CO CM 60 rH r-i CD tO IO o H ^ CM CO o to CM . . . « e o tO rH O cn O to to to to to m CM cn lO o CO tra r-i to cn co to cn E— IO tO rH r-i CC! H H H i o cn E- cn <4< to to cn to r-l o to 00 . . . . >3 . « * . © » <£) IO H CO CM CO CO to co m cn 2 to to cn E- rH tO ID O ^ •4" to •4< ^ rH r-H CM rH rH rH CO fc~ is- to to to <p CO m to to to . . . . . . . » e o 9 CM CU sH' CM to EV CO to cfc cn cn E- IO 00 CM O rH rH rH CM cn CM era to era tO "sj" r-H rH CM rH o cn CM to CM rH cn 6- rH tD tO o tra . . . c . e • . . . e » «c£ E- CM H tO O t> o cn -to CM to CO CM CO H O IO CM rH CM rH «rji rH CO to tO CM era rH rH CM rH rH ' fr- CO CO t o cn cn o to o tra o E- cn » « © » O . © 0 . O « to cn to cn ca to CO tO rH CO tO E~ to CM <o co co lOtO N CM tO rH CM <M rH tO tO CT. rH J> CM CM o tO CO to CO o to . . . « e . . e © ® 9 . . era m co tQ O rH O tO CM O to E— tO IO !0 m ^ CM era co era to tn CQ rH rH rH £*& r-1 r~% tO CO r- l O E~ rH CM CM O CO o ^ B r> . . 0 « . to <M cn t- O CM rH o cn cn o t- CO IO N r-t CO H B H H CM CM o CM rH to to to . rH i—I W H H to to CO O E- CO C~ cn to to o CO CM O . . . o . . ft e . . . . e H IO CO tn to io co CM LO tO CM E- rH CO CO C- CD rH rH rH J>- t - o tO rH CM CM rH^ rH r-i tO cn Ev to CO 1 to. o to to cn era . . . * © « CD . . . to to cn E- en to CO tO E- CO to era to to E~ CM CM to 'O era CM CM rH >4 o o o U - P • H CD 0 2 O o 01 r ^ P ) o P i U o P-I O U M CO £i oS » •H O O (=3 r. > O PI &p P-i C 03 •H M tH CQ CD • H g C3 Vi 0) -P O -P to c8 VA rH CD Pi » •H 0) C ?1 S si o Pi -H •H ad x5 crj „ Ui Pi CQ m o b M ai o o rH & &i f-1 CD o o 03 • H rrf CO 4^ (D 4 3 O CP El O 03 gj -P r d CD CU 54- "CJ - P H S S a 1 H a) ft -P 04 cci CD CD 3 H CD rH P) o o m -P f4 O p., CD CO o •H" -P CO •H -P » -P co O CD 13 pq Pi o • H a • H a o CD O I O(141) TABLE 26 DISPOSITION OF CANADIAN GRAIN BY CROP'YEARS* - 1920-1955 (LQUTiTons of "BusheIs) CROP YEAR TOTAL EXPORTS 1920 1921 1922 1923 1924 1925 1926 1927 1928 19 29 1930 1931 1932 1933 1934 1935 X«5& <» 2 158,5 229*7 289 © X 146,9 275.6 251.3 288,6 354,4 155.7 228.5 182.8 240.1 170,2 144.3 2S2 * 0 EXPORTS TO THE U.K. 87.0 XX 2 * 3 174,0 200,0 115 . 7 . 198,4 X8 5»%) 201,7 209.6 105.0 70,2 , 62 © X 103,3 114.8 100.7 162.9 EXPORTS TO THE U.S. 49.2 15,9, X (^Qf 9 21.5 e3 a X 10,5 7.6 8,4 10«0 7,0 8,1 4.5 ,3 & 2 15,0 EXPORTS TO OTHER COUNTRIES 30.5 42,8 67,1 28,0 66,7 58 . 3 78,5 154.8 43.4 93.4 81,2 83.6 . 55 © X 28,6 69.0 * Crop Years August 1st to J u l y 51st, Sources Dominion Bureau o f S t a t i s t i c s , G r a i n Reports-. (142) (143) i n m i l l i o n s o f b u s h e l s , a r e t a b u l a t e d from t h e r i g h t - h a n d s i d e o f the d i a g r a m , and a r e i n d i c a t e d i n r e d . Crop t o t a l s a r e g i v e n i n m i l l i o n s of b u s h e l s , a r e t a b u l a t e d on t h e l e f t o f t h e diagram, and a r e i n d i c a t e d by a b l a c k l i n e . I t i s e v i d e n t from the d at a s u b m i t t e d t h a t Vancouver g r a i n e x p o r t s d i d not r e a c h a n y t h i n g l i k e normal p r o p o r t i o n s u n t i l 1927, Up to t h a t y e a r , t h e P a c i f i c e x p o r t t r a d e was j u s t coming I n t o i t s own, and t h e r e i s l i t t l e v a l u e , f o r our p u r p o s e s , i n comparing crops and e x p o r t s f o r t h a t p e r i o d , Prom 1927 on, however, a marked s i m i l a r i t y between A l b e r t a c r o p s and. Vancouver e x p o r t s a p p e a r s . The two f l u c t u a t e i n much the same manner and d e g r e e ; except f o r minor d i f f e r e n c e s , c a u s e d i n l a r g e ps.rt by a heavy s t o c k c a r r y o v e r from y e a r t o y e a r and abnormal changes i n w o r l d t r a d e a c t i v i t y , t h e y show a d e f i n i t e r e l a t i o n s h i p , Saskatchewan c r o p c o n d i t i o n s show c o n s i d e r a b l y l e s s s i m i l a r i t y t o Vancouver e x p o r t f i g u r e s t h a n do A l b e r t a c r o p s , a l t h o u g h , i n a g e n e r a l way, t h e r e i s a t e n d e n c y f o r the l a t t e r t o c o i n c i d e w i t h t h e f l u c t u a t i o n s o f Saskatchewan c r o p s f r o m y e a r t o y e a r , T o t a l l i n g the two c r o p s , A l b e r t a and Saskatchewan, and p l o t t i n g them w i t h Vancouver e x p o r t s , we f i n d what might be c a l l e d a m i d - p o i n t i n s i m i l a r i t y , a s compared w i t h t h e two above mentioned g r a u h s . There a r e not such wide d i f f e r e n c e s as between Sask-atchewan and Vancouver f i g u r e s , and y e t not as c l o s e s i m i l a r i t y as between A l b e r t a and Vancouver, For example, examine the f i g u r e s f o r the y e a r s 1930-1951. Vancouver e x p o r t s f e l l o f f s l i g h t l y , t h e A l b e r t a crop a c t u a l l y i n c r e a s e d , Saskatchewan c r o p f i g u r e s dropped o f f v e r y s h a r p l y , and the A l b e r ta-Saskatchewan t o t a l l e d c r o p s d i d not f a l l o f f to such a g r e a t e x t e n t . I n t h e y e a r s 1933-1934, t h e s i t u a t i o n was much t h e same, and would l e a d one t o t h e c o n c l u s i o n t h a t t h i s i s the r u l e , r a t h e r t h a n t h e e x c e p t i o n , T h i s p o s i t i o n strengthens the v i e w , h e l d by many, that t h e f i e l d o f i n f l u e n c e e x e r t e d by t h e Panama Canal e x t e r d s i n l a n d t o a p o i n t on t h e t r a n s c o n t i n e n t a l r a i l w a y s y s t e m w i t h i n t h e b o u n d a r i e s o f Saskatchewan* Depending on e x t e r n a l c o n d i t i o n s , t h i s p o i n t f l u c t u a t e s f rom t i m e t o t i m e , and i s , i n a l l p r o b a b i l i t y , w e l l w i t h i n t h e western b o u n d a r y of t h a t p r o v i n c e . I f M a n i t o b a c r o p c o n d i t i o n s f r o m 1922 .to 1935 are compared w i t h Vancouver e x p o r t s , i t w i l l b e s e e n i m m e d i a t e l y t h a t t h e r e l a t i o n s h i p e x i s t i n g i n t h e o t h e r two p r o v i n c e s i s not m a i n t a i n e d . M a n i t o b a c r o p s do not a f f e c t the volume o f wheat e x p o r t e d t h r o u g h t h e P o r t o f Vancouver i n any re s p e c t , a t l e a s t not t o t h e e x t e n t t h a t i t i s n o t i c e a b l e i n any o f the f o r e g o i n g d a t a . I t i s r e a s o n a b l e t o b e l i e v e that M a n i t o b a wheat has a n a t u r a l t e n d e n c y t o f l o w e a s t down t h e S t , Lawrence watershed, and t h a t i t does not e n t e r i n t o t h e P a c i f i c t r a n s p o r t a t i o n system at a l l . The c o n c l u s i o n may be drawn t h a t any f u r t h e r change i n t h e t r a d e v i a t h e P a c i f i c c o a s t w i l l t a ke p l a c e as a r e s u l t of improvements i n t h e C a n a d i a n d i s t r i b u t i v e system ( i n t e r n a l or e x t e r n a l ) ,. west o f an I m a g i n a r y l i n e running n o r t h and s o u t h t h r o u g h the p r o v i n c e o f Sask-atchewan. Up t o t h e p r e s e n t , t h i s change i n c o n d i t i o n s has been b r o u g h t about, p a r t i a l l y a t l e a s t , through.the o p e n i n g of t h e Panama C a n a l . The r e s p o n s i b i l i t y l i e s w i t h C a nadians t o t a k e f u l l a dvantage of the (14-7) improvements a l r e a d y i n i t i a t e d , by making f a r t h e r a d j u s t m e n t s i n t h e near f u t u r e . I n a p p r o a c h i n g the Canadian f r e i g h t r a t e p roblem, one soon d i s c o v e r s t h a t M a n i t o b a was not the f i r s t p r o v i n c e to c o n r a l a i n of d i s c r i m i n a t i n g f r e i g h t r a t e s on g r a i n . The C a n a d i a n r a i l w a y system and r a t e s t r u c t u r e have b e e n under t h e c o n t r o l o f a c a p a b l e b o a r d of R a i l w a y Commissioners, h a v i n g the power t o s e t r a t e s and g o v e r n t r a f f i c . T h i s b o a r d i s a n independent t r i b u n a l , w h i c h h e a r s r e q u e s t s f o r r a t e a d j u s t -ment i i t s e t s r a t e s on the b a s i s o f such r e q u e s t s , b u t cannot o f i t s own a c c o r d i n i t i a t e r a t e a d j u s t m e n t s. P r i o r t o 1927, b o t h A l b e r t a and B r i t i s h Colurnbia c a r r i e d on a v e r y a c t i v e propaganda program to have the e x p o r t r a t e on g r a i n s h i p p e d t o the P a c i f i c Coast r e d u c e d , Not l o n g a f t e r t h e ope n i n g of t h e canal., a g i t a t i o n commenced f o r lower r a t e s on g r a i n s h i p p e d over t h e n a t i o n a l r a i l w a y s t o t h e P a c i f i c C o a s t , Such pub l i e and s e m i - p u b l i c b o d i e s a s the governments o f the p r o v i n c e s of B r i t i s h Columbia and A l b e r t a , t h e U n i t e d Farmers, g r a i n g r o w e r s ' a s s o c i a t i o n s , B o a r d s o f T r a d e , e x p o r t e r s , and many o t h e r s b e n t e v e r y e f f o r t t o p r e s e n t t h e s t r o n g e s t p o s s i b l e c a s e t o t h e Board of R a i l w a y Commissioners. U n d o u b t e d l y , a g r e a t d e a l o f t h e c r e d i t f o r the e v e n t u a l s u c c e s s o f the movement i n 192? was due t o t h e o u t s t a n d i n g a b i l i t y of one man, Mr, G.G. McGeer, M.P., K.C.; the people o f Western Canada owe him a debt which c o u l d not be w h o l l y l i q u i d a t e d by t h e payment o f a s u b s t a n t i a l f e e when h i s work was done. As a r e s u l t of t h i s v e r y e f f e c t i v e propaganda, t h e B o a r d of R a i l w a y Commissioners o r d e r e d a' , .  1148) r e d u c t i o n i n r a t e s i n 1927, and d i r e c t e d t h a t t h e r e a f t e r t h e r a i l w a y s s h o u l d c h a r g e e q u a l r a t e s f o r e q u a l d i s t a n c e s on g r a i n moving e i t h e r e a s t o r w e s t t h r o u g h Canada, S i n c e t h a t d a t e , Canadian f r e i g h t r a t e s on g r a i n have been s t a b i l i z e d a t t h a t p o i n t . An i l l u s t r a t i o n of t h e changes w h i c h have t a k e n p l a c e i n t h e f r e i g h t r a t e s t r u c t u r e s i n c e 1920 I s g i v e n i n Table 27 (Page 149) and F i g u r e 4 5 , (Page 150), By way of e x p l a n a t i o n , i t may be s a i d t h a t , i n computing the r a t e s s u b m i t t e d i n t h e above t a b l e and d i a g r a m , a p o i n t was s e l e c t e d on the C a n a d i a n N a t i o n a l S a i l w a y , B a t t l e f o r d , Sa.sk., midway Tjetween Vancouver and F o r t W i l l i a m , and the r a t e t o the two l a t t e r p o i n t s was c a l c u l a t e d i n c e n t s p e r b u s h e l , I t can b e s e e n f r o m t h e t a b l e t h a t , from 1921 to 1927, the r a t e on g r a i n s h i p p e d from B a t t l e f o r d t o Vancouver dropped s t e a d i l y u n t i l i t was s e t at 14.9 c e n t s per b u s h e l by the Board o f R a i l -way C ommissioners. The r a t e e a s t , f r o m B a t t l e f o r d to F o r t W i l l i a m , i n c r e a s e d f r o m 14,3 c e n t s i n 1921 t o 21.7 c e n t s i n 1922, where I t remained u n t i l i t was a l t e r e d t o e q u a l t h e r a t e west, 14,9 c e n t s p e r b u s h e l . The d i a g r a m shows q u i t e p l a i n l y that- i m m e d i a t e l y t h e r o t i t e t h r o u g h the c a n a l came i n t o a c t i v e u s e ( 1921), the f r e i g h t r a t e s on wheat moving west were a d j u s t e d t o meet the new c o m p e t i t i v e f a c t o r . T h i s development was not o n l y t r u e of wheat, h u t of a l l goods moving west f o r e x p o r t s . To i l l u s t r a t e more f o r c e f u l l y the e f f e c t of t h e c a n a l on t h e w e s t e r n r o u t e , one has but t o p o i n t t o t h e f a c t t h a t t h e f r e i g h t r a t e on wheat moving west f o r d o m e s t i c c o n s u m p t i o n i s s t i l l o v e r 4 5 ^ per b u s h e l . I n t h i s i n s t a n c e , t h e c a n a l i s not a c o m p e t i t i v e f a c t o r , and t h e r a i l w a y s (149) CvJl EH] f pH V p5 CD m in CD 01 -P CD O ID cn O cn o cn CO © © © © < © Oi t o LO 1 o si" rH CM | r-l rH CM cn CO LO CM a i o to © © « © B » © LO LO t o •tf" o i — ! rH CM r H r-l CM to rH cn o 01 to » © © © © © O l to in co o r-l r H CM rH rH CM CM 01 rH sH cn to to © © © © © - © © 01 LO LO LO to CO r-l r H CM r H rH CM r-i cn LO O cn to to © © © © cn to t O to CO rH r H CM r H rH CM O cn o cn CO cn CO CM to © © © © © a © cn CO << Ol r H rH rH rH CM cn cn to cn 0> to C\2 © 0 * © © © Q cn LO in O rH r H CM rH to CO cn to cn in CM © © • © cn CO o CM r-l r H co rH to c - cn LO r-l LO Cn rH o C\> « © © a © a © cn CO o . rH tO r-l rH to rH CM to tO t o o r-i 10 t D o> © © © © © © a cn r H cn O CM to o to rH CM rH rH CM to to !> o "1 m CM © © © © © a cn rH rH cn CO to cn ID CM to rH rH CO ; • » - o 05 to rH in CM © 0 fl © © 9 cn r H cn CO cn t O cn in rH CM to rH rH to to rH in cn CM © o • © © © cn ! ^ o o to Q to rH i CM rH ' rH c a to CM i C'~ to cn to to 01 CM ' , © © . © © © © © cn ! r H o cn CO o CO rH 1 W rH to rH CM to r-l 1 to cn t- cn o to tO CM © © © 9 © cn *^ o cn 01 to rH rH rH r H to CM rH <L> w -p ©9 oi •H P-0) •P Pi rH • H • H - P U O I ro oi CD U • H r H r H - P as -p W in I ° SO - P o o o Pi S4 CD oil ^ 1 ro c3 - P CD ra'J f-< (A - P CD o f IH I CD H O o r j cd •H r " f-l CD t> ?S O o Co a O o p, f-l a> ^> • H Hi fH O < H CD CD - P r H CD" - P M CD ti PQ cci a> o o f-l CD s> g o co' rH cd - P O S3 © a> si m csS & - P rQ ra 0> cs»! I 3 o © -p - P OS © ra rQ <D rH CO 0) CM rCl to - P rH O o © 03 ca •H O CD CO •H cS -P aS rQ CO •H CD CD J - ' > .3 - P - P sn 32 o C M o CO CD m H rj CD r° rH - P D id - P o •H 6 Tj •a 0 T! - P a •zs CO o CD pi (H - P •r-i O rO' H a3 od & CD K ) ra U 0 a CD as O CD © « H - P O C(5 rO rH CD •d a o ctf s o f-i | o rH EH ! 3 «H CO O •H f-l KS CO f-i s •r-l ci <p ra >4 I CD CD f-l - P CD rS t- o CP W CD aS j> O -H bo CD si M - P CD t—i Pi (150) t o txi I fx. •> o PI <*\ P3 w EH io f 3 P3 a a < o > cd i—t — -& S3 o P) O co o a PH PH EH PI O o EH E-i CO o «{ o P -H P! •=4 P O taj Q P H P3 fx, c i <! EH EE PH t> I 1 \ 1 i • : a I 1 ! 1 a 1 ! | \ / y 1 \ \ 1 1 1 • ! 1 / I. / 1 CQ PH SH U CD CD O P H O O O O CJ» CO o o o o to o CVJ a CD PI ?H C4 CD £ t> CO 0 as i-t CD 1 c4 >> T j CD 3 ?H fH O O -P o « M c s m o m - t ^ > - p •P CO «S aJ - H -rH PH > > 4= C id o aj o O P i CD o (151) keep t h e r a t e up t o t h e p o i n t o f "what the t r a f f i c w i l l h e a r " . Another f a c t o r of g r e a t i m p o r t a n c e i n t h e m a r k e t i n g o f C a n a d i a n g r a i n i s t h e e f f e c t of ocean f r e i g h t r a t e s on g r a i n shipments. T a h l e 27, on Page 149, shows the a v e r a g e c o s t o f s h i p p i n g a b u s h e l o f wheat f r o m Vancouver t o L i v e r p o o l , y e a r by y e a r f r o m 1921-1935. Table 26, on Page 152, g i v e s t h e s e f i g u r e s , i n a d d i t i o n to comparable r a t e s on the A t l a n t i c , a s an index, w i t h 1921 as t h e he.se y e a r . F i g u r e 46, Page 153, shows the two i n d e x e s ( A t l a n t i c and P a c i f i c ) p l o t t e d on a graph* The outstanding f e a t u r e o f F i g u r e 46 i s t h a t P a c i f i c Ocean r a t e s "tip t o 1927 showed an upward t r e n d , w h i l e A t l a n t i c r a t e s during- t h e same p e r i o d dropped a t q u i t e a r a p i d r a t e . A f t e r 1927, P a c i f i c r a t e s showed the r e l a t i v e l y g r e a t e r d e c l i n e o f t h e two. Such a change was i n p a r t due t o t h e r e d u c t i o n i n r a t e s by t h e Canadian r a i l w a y s a f t e r 192". We see h e r e t h e i n t e r - p l a y o f two g r e a t f o r c e s i n a c o m p e t i t i v e market ~ the Canadian r a i l w a y system, and t h e Panama C a n a l . W h i l e t h e s e were "by no means the o n l y f o r c e s a t work, u n d o u b t e d l y t h e c a n a l f o r c e d r a i l r a t e s down, and the l a t t e r , i n t u r n , e x e r t e d pressure on ocean r a t e s . The two worked one a g a i n s t the other,, to the u l t i r o a t e "benefit o f t h e g r a i n t r a d e by a r e d u c t i o n i n c o s t s of t r a n s p o r t a t i o n . However, l e t u s see what r e l a t i o n s h i p , I f any, e x i s t s between th e volume o f B r i t i s h Columbia wheat e x p o r t s a m the l e v e l of ocean f r e i g h t r a t e s . I s t h e r e any t e n d e n c y on t h e p a r t o f t h e one to i n c r e a s e w i t h a d r o p I n t h e o t h e r ? Figure 47, Page 154, shows the a c t u a l volume, i n b u s h e l s , o f C a n a d i a n g r a i n e x p o r t e d t h r o u g h t h e P o r t of Vancouver, and (152) TABLE 28 ATLANTIC AND PACIFIC FREIGHT PATES ON MEAT ATLANTIC PACIFIC YEAR IS 21 IS 1923 1924 1926 192? 1928 1929 I S 30 I S 3 3, 1932 I S 3 1934 1935 RATE (IN CENTS PER BUSHEL.) INDEX (1921 r= 100) 14.7 7.6 7.7 8,9 7.4 10.7 7.1 5.3 4„9 6.0 5.7 5.1 6,0 100 5 2 52 60 50 75 49 49 36 33 41 39 35 58 41 ' RATE~1 IE CENTS PER INDEX (1921 = 100) BUSHEL) 19.6 20.6 20,5 19.1 19.4 20,5 S I * 1 17.5 15.4 12 © 3 1 3 . 4 13 .4 10.0 10.0 10,0 100 105 105 97 99 105 108 89 78 63 68 68 51 51 51 (155) t h e a c t u a l c o s t per b u s h e l f r o m Vancouver t o L i v e r p o o l , The amounts f o r t h e f o r m e r a r e i n d i c a t e d , i n m i l l i o n s o f b u s h e l s , on t h e r i g h t s i d e o f the d i a g r a m , w h i l e the c o s t i n c e n t s per b u s h e l a p p ears on the l e f t . An e x a m i n a t i o n o f t h i s d i a g r a m g i v e s v e r y l i t t l e c o n c l u s i v e e v i d e n c e o f a c l o s e r e l a t i o n s h i p between t h e two; i n f a c t , t h e r e i s ev e r y r e a s o n t o b e l i e v e that-ocean- r a t e s a f f e c t t h e volume o f g r a i n much more t h a n the s t a t i s t i c a l d a t a demonstrate. I t i s t r u e t h e t r e n d o f Vancouver e x p o r t s i s up, w h i l e t h a t o f f r e i g h t r a t e s i s down, over the whole p e r i o d , but any more e x a c t coneIn. s i on cannot be d e r i v e d . U n d o u b t e d l y , a d r o p • I n ocean r a t e s , i f i t t a k e s p l a c e on the P a c i f i c , and not to t h e same e x t e n t on t h e A t l a n t i c , i s advantageous to e x p o r t e r s o p e r a t i n g t h r o u g h t h e P a c i f i c C o a s t , I f the drop i s g e n e r a l on b o t h t h e A t l a n t i c and P a c i f i c , t h e r e s u l t s may o n l y be g u e s s e d . So many f a c t o r s e n t e r i n t o t h e s i t u a t i o n as to c o n f u s e the i s s u e . P e r h a p s the p r a c t i c a l o p i n i o n o f a g r a i n e x p o r t e r t h r o w s more l i g h t on t h e s u b j e c t than pages o f s t a t i s t i c s . The f o l l o w i n g r e p o r t appears i n the Vancouver D a i l y P r o v i n c e of J u l y 26, 1937;-" B.D. Purely o f C a l g a r y , g e n e r a l manager of the A l h e r t a Wheat P o o l , s t a t e d t h i s morning t h a t t h e r e i s a remote p o s s i b i l i t y t h a t t h e p o o l may resume o p e r a t i o n o f Ho. 2 H a r b o r B o a r d e l e v a t o r , whose l e a s e was s u r r e n d e r e d r e c e n t l y . , r , B u t t h e d e c i s i o n depends on t h e f r e i g h t r a t e s i t u a t i o n ' , Mr. Purdy s a i d . !¥e w o u l d l i k e to see e v e r y b u s h e l o f A l b e r t a g r a i n come t h i s way', he added. 'But the f r e i g h t c o n d i t i o n s t h r o u g h -out t h e w o r l d m i l i t a t e a g a i n s t t h a t movement at p r e s e n t , and-I cannot see how th e y can he improved u n l e s s r a t e s d r o p . ' " 1, Vancouver D a i l y P r o v i n c e , Vancouver, B.C., J u l y 26, 19157, p (156) The most i m p o r t a n t a s p e c t o f the ocean t r a n s p o r t system on the P a c i f i c C o a s t , and one which i s n o t easy to d e s i g n a t e w i t h a c c u r a c y , i s the tonnage problem. U n f o r t u n a t e l y , t h e r e i s no means "by w h i c h one can a r r i v e a t even an e s t i m a t e of t h e f a c t o r s I n v o l v e d I n t h i s problem. Canadian tonnage t h r o u g h the Panama. Canal i s d i v i d e d , on the b a s i s of e x p o r t s and i m p o r t s , i n t h e r a t i o o f a p p r o x i m a t e l y 9 to 1. That i s t o say, f o r e v e r y n i n e t o n s o f s h i p p i n g o r i g i n a t i n g i n B r i t i s h Columbia and p a s s i n g t h r o u g h the c a n a l , o n l y one comes i n r e t u r n f o r t h i s p r o v i n c e . On t h e o t h e r hand, the A m e r i c a n r a t i o i s c o n s i d e r a b l y l e s s , a l t h o u g h s t i l l o ut of b a l a n c e . .Sir. E. G. Mears e s t i m a t e s t h e A m e r i c a n r a t i o a t r o u g h l y 2:1. T h i s e s t i m a t e does not i n c l u d e t a n k e r s , s i n c e the l a t t e r a r e s p e c i a l i z e d types of c a r r i e r s , u t i l i z e d o n l y i n s h i p p i n g o i l c a r g o e s , and, by t h e v e r y n a t u r e of the t r a d e , must t r a v e l i n b a l l a s t a. l a r g e p a r t of t h e t i m e . On t h e f o l l o w i n g page i s r e p r o d u c e d one of Mr, Mears' t a b l e s , showing e x p o r t s and I m p o r t s , i n thousands of l o n g t o n s , from and to A m e r i c a n P a c i f i c C o a s t p o r t s d u r i n g the y e a r s 1922-1930, A l t h o u g h t h i s d a t a i n c l u d e s a l l t r a d e , Panama end o t h e r w i s e , I t s e r v e s to i l l u s -/ t r a t e t h e u n b a l a n c e d c o n d i t i o n of American t r a d e . As we have seen, t h e Canadian s i t u a t i o n I s much more s e r i o u s t h a n the A m e r i c a n , and a l t h o u g h i t s g r a v i t y i s somewhat a l l e v i a t e d by t h e f a c t that we can and do o p e r a t e under t h e American l o a d r a t i o , s t i l l , when t h e r e i s a s c a r c i t y of s h i p p i n g , t h e problem becomes most a c u t e . The a c t u a l s h o r t a g e o f w o r l d tonnage during- the l a t t e r p a r t of 1957, caused by the s c r a p p i n g o f many v e s s e l s and the w i t h d r a w a l of over 80 Japanese s h i p s from r e g u l a r s e r v i c e to war-time use, a c t e d a s a v e r y (157) TABLE 29 AMERICA! PACIFIC COAST EXPORTS MID IMPORTS 1922-1930 (Thorisands o f Long: Tons) - E X P O R T S I M P O R T S YEAR TOTAL NON-TAMKER TMKER TOTAL NQM-TA¥KER TANKEI 19 22 0 $ 2 2 2 4, 276 946 1,431 1,585 46 1923 6,544 3,796 2,748 2,322 2,308 14 1924 9,500 5,386 4,114 2^559 2 g 5 5 2 7 1925 8,505 4,474 4,031 2,534 2,534 _ 1926 9,909 5,556 4,573 2,609 2,593 16 1927 12,004 6,099 5,905 2 *j 815 2,745 . 70 1928 13,926 7,093 6,833 2,885 2 a796 89 IS 2 s 13,498 7,158 6,340 3,112 3,014 98 1930 13,345 6,477 6,868 3 5 1? 6 3,099 77 So u r c e : Mears, E.G. Liar i t ime Trade of Vie s t e r n U n i t e d S t a t e s , S t a n f o r d - J 1935, p.22 (158) s e r i o u s h a n d i c a p t o P a c i f i c C o a s t p o r t s , and w i l l he r e f l e c t e d i n t h e 1937-1938 f i g u r e s f o r B r i t i s h Columbia e x p o r t s . T h i s problem of tonnage i s one o f the most s e r i o u s to be met I n marketing the W e s t e r n Canadian g r a i n c r o p through t h e Panama Canal, and I t a c t s as a d e t e r r e n t t o what might o t h e r w i s e be a v e r y s p e c t a c u l a r development. Ano t h e r v e r y s e r i o u s d i s a b i l i t y i n h e r e n t i n the Western r o u t e i s f o u n d i n t h e g e n e r a l c o n d i t i o n o f t e r m i n a l f a c i l i t i e s on the P a c i f i c C o a s t . The development of p r o p e r s t o r a g e f a c i l i t i e s has been v e r y s l o w , and, w h i l e i t I s a s s e r t e d t h a t ample s t o r a g e i s a v a i l a b l e at the p r e s e n t t i m e , I t cannot be t o o f o r c i b l y s t r e s s e d t h a t the n e c e s s i t y , from t i m e to t i m e , o f i n a u g u r a t i n g a p e r m i t system i n t h e coast e l e v a t o r s has u n d o u b t e d l y had a s e r i o u s p s y c h o l o g i c a l e f f e c t on p r a i r i e s h i p p e r s . D u r i n g • t h e past'15 y e a r s , e f f o r t s have been made t o t r a n s f e r t h e i r b u s i n e s s from t h e E a s t to the west, They have been accustomed t o d e a l i n g t h r o u g h P o r t W i l l i a m and Montreal, or o t h e r E a s t e r n p o i n t s , f o r a good many years, and i t i s not t h e e a s i e s t matter to g e t them t o change t h e i r connections and e x p o r t by t h e W e s t e r n r o u t e . I f , t h e r e f o r e , t h e r e i s a b l o c k i n the f l o w of g r a i n , i f , f o r any reason, the storage f a c i l i t i e s become inadequate, i t becomes i n c r e a s i n g l y d i f f i c u l t t o a t t r a c t - w e l l - e s t a b l i s h e d f i r m s to t h e new r o u t e , T a b l e 30, on Page 159, g i v e s the l a t e s t Dominion B u r e a u of S t a t i s t i c s ' r e p o r t on the s t o r a g e f a c i l i t i e s f o r g r a i n i n each p r o v i n c e , and i t w i l l s e r v e to I l l u s t r a t e the.unequal d i s t r i b u t i o n of e l e v a t o r space i n the D o m i n i o n , The t h r e e W e s t e r n p r o v i n c e s have, i n a l l , some (159) TABLE 50 SUMMARY OF ELEVATOR STORAGE CAPACITY BY PROVINCES. - 1936 Nova S c o t i a 2, 200,000 bu. New B r a n s w i c k 3, 076,800 tt Quebec 22, 537,000 tt O n t a r i o 144, 757,210 n M a n i t o b a 30, 575,650 it S a s k a t chev/an 117, 845,200 »» A l b e r t a 76, 657,900 B r i t i s h Columbia 22, 240,720 tt Canada Year Book, ) o £5S 5» (160) 216 m i l l i o n "bushels* e l e v a t o r c&pf c i t y , w h i l e t h e E a s t has 203 m i l l i o n , However j, s i n c e Saskatchewan i s the " b o r d e r - l i n e p r o v i n c e , i t seems b»rdlv rea.s6na.hle t o i n c l u d e i t s s t o r a g e as p a r t o f e i t h e r t h e E a s t e r n or W e s t e r n sy s t e m s . E l i m i n a t i n g t h i s f r o m t h e Western D i v i s i o n l e a v e s A l b e r t a , and B r i t i s h C o l umbia w i t h e l e v a t o r c a p a c i t y o f s l i g h t l y o v er 100 m i l l i o n b u s h e l s , by c o m p a r i s o n w i t h t h e E a s t e r n D i v i s i o n ' s 200 m i l l i o n "bushels. B r i t i s h Columbia, t h e p r o v i n c e f u r t h e s t west on the t r a n s -c o n t i n e n t a l r a i l w a y system, has, i n a l l , o n l y 22 m i l l i o n b u s h e l s * s t o r a g e c a p a c i t y , and. the P o r t o f Vancouver, t h e t e r m i n u s of both t r a n s c o n t i n e n t a l l i n e s , o n l y 17 m i l l i o n . The E a s t e r n D i v i s i o n , however, i s even more b o u n t i f u l l y s u p p l i e d w i t h t e r m i n a l f a c i l i t i e s than, i s apparent f r o m the d a t a s u b m i t t e d , s i n c e t h e g r a i n c r o p can he h a n d l e d t h r o u g h o t h e r f a c i l i t i e s than e l e v a t o r s . Mitch o f the y e a r * s c r o p i s l e f t i n t h e h o l d s o f g r a i n s h i p s , t i e d up i n Great Lakes p o r t s d u r i n g - the w i n t e r months. I n a d d i t i o n , American p o r t f a c i l i t i e s a r e a v a i l a b l e t o g r a i n s h i p p e d I n t h i s d i r e c t i o n , and, as a r e s u l t , a good p a r t o f the Canadian c r o p p a s s e s t h r o u g h A merican p o r t s . (See T a b l e 25, Page 140.) The c i t y o f B u f f a l o a l o n e , w i t h 25 m i l l i o n b u s h e l s ' s t o r a g e , has a g r e a t e r e l e v a t o r c a p a c i t y t h a n the t o t a l c a p a c i t y f o r t h e whole o f the p r o v i n c e o f B r i t i s h C o l u mbia. F i n a l l y , and p r o b a b l y most i m p o r t a n t o f a l l , when the Canadian g r a i n crop f l o w s E a s t , i t has a l a r g e r home market and a w i d e r o u t l e t t h r o u g h t h e m i l l i n g companies t h a n e x i s t s i n the West. B r i t i s h C o l u m b i a , w i t h a p o p u l a t i o n o f s l i g h t l y over 750,000 p e o p l e , cannot absorb t h e (161) volume o f wheat w h i c h goes i n t o t h e i n d u s t r i a l s e c t i o n s of E a s t e r n Canada and the U n i t e d S t a t e s . Under such c o n d i t i o n s , t h e r e i s l i t t l e wonder t h a t g r a i n d e a l e r s p r e f e r to c o n t i n u e t o o p e r a t e i n the E a s t r a t h e r t h a n i n t h e West, u n l e s s , p e r c h a n c e , they ere a s s u r e d o f a sub-s t a n t i a l r e d u c t i o n i n c o s t s over a l o n g e r p e r i o d of t i m e by the W e s t e r n r o u t e . Under such cramped and u n s t a b l e o p e r a t i n g c o n d i t i o n s , i t i s c ustomary f o r d e a l e r s e x p o r t i n g g r a i n by the W e s t e r n r o u t e t o s h i p t h e b u l k o f t h e i r s t o c k a t t h e i r own r i s k , a s i t u a t i o n w h i c h has never p r e v a i l e d i n E a s t e r n Canada, S i n c e they are under the c o n s t a n t p r e s s u r e o f h a v i n g to t a k e whatever cargo space o f f e r s at the b e s t r a t e t h e y can g e t j t h e y s h i p wheat out o f Vancouver u n s o l d , t o be d i s p o s e d o f en r o u t e t o E n g l a n d or t h e C o n t i n e n t . To f u r t h e r c o m p l i c a t e m a t t e r s , European c o u n t r i e s , d u r i n g the l a s t few y e a r s , have been b u y i n g t h e i r g r a i n on a hand-to-mouth b a s i s , t h u s i n c r e a s i n g t h e d i f f i c u l t i e s o f a r r a n g i n g ca r g o space, I t i s c o n d i t i o n s such as t h o s e enumerated above w h i c h a c t as a v e r y r e a l b a r r i e r t o the normal u s e end development o f the W e s t e r n r o u t e . I n f a c t , I t might almost be s a i d t h a t t h e s e a r e f a r more - r e a l and e f f e c t i v e t h a n t h e a c t u a l f a c t o r o f c o s t . C e r t a i n l y , t h e y form a v e r y i m p o r t a n t and formida.ble p a r t o f the problem to be s o l v e d . There i s a p o p u l a r m i s c o n c e p t i o n abroad t h a t the f r e e z e - u p of the G r e a t Lakes and t h e S t , Lawrence R i v e r i s r e s p o n s i b l e f o r a l a r g e p a r t o f t h e volume o f g r a i n shipments by the West Coast r o u t e , p a r t i c u l a r l y ( 1 6 2 ) f o r a l a r g e r volume o f e x p o r t s t h r o u g h t h e Panama, d u r i n g the w i n t e r months. T h i s i s a p o i n t of v i e w w h i c h i s not s u b s t a n t i a t e d by the a v a i l a b l e f a c t s . T a b l e 31, Page 163, t a k e n from t h e Vancouver Harbor B o a r d r e p o r t s , shows Vancouver wheat e x p o r t s by months from 1929-1935. U n f o r t u n a t e l y , we a r e a g a i n c o n f r o n t e d by t h e v a g a r i e s o f bygone H a r b o r Commissions, and we have not the f i g u r e s f o r t h e c r o p year 1930-31. E x p o r t s f o r t h e y e a r 1929-1930 show June as the month w i t h t h e h i g h e s t volume, and t h e t o t a l f o r t h e months November t o F e b r u a r y , inclusive',,, i s o n l y 24% o f the t o t a l f o r the y e a r . The.t i s t o say, d u r i n g o n e - t h i r d o f the y e a r , l e s s t h a n o n e - q u a r t e r o f t h e g r a i n e x p o r t e d i n the 12 months p a s s e d t h r o u g h Vancouver. The- f o u r months w i t h l a r g e s t volumes o f e x p o r t s were. June, w i t h 8,386,000 b u s h e l s ; May, w i t h 7,403,000 b u s h e l s ; O c t o b e r , w i t h 6,540,000 b u s h e l s ; and J u l y , w i t h . 5,800,000 b u s h e l s . T h i s would h a r d l y seem a c o n c e n t r a t i o n of exports i n the f o u r w i n t e r •months. However, t h i s y e a r may have b e e n e x c e p t i o n a l , and, o f t h e f i v e c i t e d , i t was. I n 1931-1932, A p r i l had the h i g h e s t r e c o r d , n e x t J a n u a r y , t h e n December and May. The t o t a l e x p o r t s f r o m November to F e b r u a r y c o n s t i t u t e d 4 0 % o f the t o t a l y e a r ' s e x p o r t s . I n 1932-1933, t h e t o t a l f o r the w i n t e r months was the h i g h e s t p e r c e n t a g e f o r any of. the y e a r s g i v e n - 48%; I n 1933-1934, i t f e l l o f f t o 44%; and i n 1934-1955, i t was q u i t e back t o normal a g a i n a t 35%. As a m a t t e r o f f a c t , t h e r e a s o n f o r any c o n c e n t r a t i o n o f e x p o r t s i n t h e w i n t e r months seems t o have l i t t l e r e l a t i o n t o t h e f r e e z e - u p i n t h e E a s t ; r a t h e r , i t b e a r s a c l o s e r l i k e n e s s t o the c r o p c a r r y o v e r i n (163) TABLE 31 YANOOU¥EH GRAIN SHIPMENTS. BY I,'DNTHS (Thousands of B u s h e l s ) MONTH 1929-1930 1930-1931 1931-1932 1932-1933 1933-1934 1934-1935 August 5 p 223 — ' 2,708 3 j *SS 2 2,094 2 <j 5 71 September 5,577 - 65 5 5 3 61 2,673 3, 500 O c t o b e r 6,540 „ 3,723 11,407 4,504 5, 650' Novemb er 5 .j 16 o 6,437 13,18? 4,489 4,825 December 3,784 10,036 13,41? 5,263 4,079 J a n u a r y 3,707 11,446 10,975 6,515 5,13? F e b r u a r y 5,158 - 6,518 10,089 5,546 4,381 liar c h 2,928 7,771 9,863 4,67? 4,722 5,214 _ 12,087 5,748 3,540 5, 278 May 7,403 „ - 7,983 5,68? 2,365 6,224 June 8,586 •- 6,977 4,-671 4,154 2,392 J u l y 5,800 _ 5,160 2,771 4,434 5, 313 Sources Vancouver Harbor Board- Reports, 1929-1935. (164) the W e s t e r n D i v i s i o n , from one y e a r t o t h e n e x t . T a b l e 25, Page 140, g i v e s t h e movement of t h e We s t e r n D i v i s i o n c r o p e a c h y e a r , and i n c l u d e s t h e c a r r y o v e r f o r t h e y e a r s i n q u e s t i o n . I t w i l l be seen from the t a b l e t h a t the c a r r y o v e r f o r 1929-1930 was 85 m i l l i o n b u s h e l s , not an abnormal s t o c k on hand at the end o f t h e y e a r . I n 1931-19 32, i t had i n c r e a s e d to 109 m i l l i o n , and t h e p e r c e n t a g e o f e x p o r t s t h r o u g h Vancouver d u r i n g the f o u r w i n t e r months i n c r e a s e d . The f o l l o w i n g t a b l e g i v e s t h e s e f i g u r e s i n d e t a i l s - - %AGE NOV,-FEB. BEARS OP Mlf- CARRYOVER IMilL UAL TOTAL, (Mi 13,Io IT¥ IST" Bus he I s_) 1929- 1930 24% 85,0 1930- 1931 - U 4 . 4 1931- 1932 4 0 % - 109,0 1932- 1933 4 8 % 172.9 19 33-1934 ' 44% 153.6 1934-1935 35% 157,3 I t w o u l d appear f r o m t h e f o r e g o i n g f a c t s t h a t t h e d a t a a v a i l a b l e do not a d e q u a t e l y s u b s t a n t i a t e the statement t h a t the w i n t e r months i n the B a s t a f f e c t t h e volume of g r a i n e x p o r t e d i n the West, There e x i s t s between t h e g r a i n t r a d e of We s t e r n Canada and the g e n e r a l t r a d e o f t h i s area, an o b v i o u s r e l a t i o n s h i p , and w h i l e t h i s c h a p t e r , has been l a r g e l y d e v oted t o t h e g r a i n trade, i t must be borne i n mind t h a t the Panama C a n a l a f f e c t s t he whole o f W e s t e r n Canadian t r a d e i n much t h e same manner. So i n t e r - r e l a t e d a r e t h e t h r e e , at t i m e s t h a t i t becomes almost i m p o s s i b l e t o t e l l w h ich i s the i m p o r t a n t f a c t o r wheat, g e n e r a l t r a d e , or the Panama C a n a l . For example, the e x p o r t of g r a i n to Europe t h r o u g h P a c i f i c Coa p o r t s has i n c r e a s e d the e x p o r t o f o t h e r goods produced i n the West. I n many i n s t a n c e s , g r a i n combines w e l l as a cargo with, other p r o d u c t s , a f a c t w h i c h i s p a r t i c u l a r l y t r u e o f lumber, A cargo of g r a i n can be s t o r e d b e l o w d e c k s , w h i l e a d e c k l o a d of lumber can be c a r r i e d i n ' a d d i t i o n , t h u s a d d i n g to t h e e f f i c i e n c y of the s h i p , c u t t i n g t h e c o s t of t r a n s p o r t a t i o n , and, most Important of a l l , f a m i l i a r i s i n g new market s w i t h another W e s t e r n C a n a d i a n p r o d u c t . By o p e n i n g up new trade routes f o r wheat, t h e Panama Canal has a l s o awakened an i n t e r e s t i n a multitude o f other Canadian products, a consequence wh i c h has been p a r t i c u l a r l y v a l u a b l e t o B r i t i s h C olumbia f i s h i n g , mining, and f o r e s t I n d u s t r i e s , Taken f r o m a n o t h e r a n g l e , water-borne i m p o r t s i n t o W e s t e r n Canada are encouraged by low f r e i g h t r ates. • Dae to the l a r g e part w h i c h g r a i n e x p o r t s p l a y I n B r i t i s h Columbia's t o t a l e x p o r t t r a d e , and t h e r e s u l t i n g unbalanced l o a d r a t i o , keen c o m p e t i t i o n and r e l a t i v e l y low r a t e s r e s u l t f o r c a r g o e s coming t o the P a c i f i c Coast. T h i s advantage i s f e l t i n t h e import t r a d e , p a r t i c u l a r l y by s h i p p e r s dealing- i n goods of a b u l k y n a t u r e , a s , f o r example, hooks, t e a , s t e e l and i r o n goods, m a c h i n e r y , e t c . I t i s g e n e r a l l y agreed that one o f the most i m p o r t a n t f a c t o r s i n t h e s p e c t a c u l a r development o f the P o r t of Vancouver was t h e c o m p l e t i o of the Panama Canal a Vancouver r e c e i v e d i t s I n i t i a l impetus when the C a n a d i a n P a c i f i c H a l l w a y l i n k e d I t to t h e r e s t o f Canada, I t became one o f t h e key c i t i e s o f t h e Dominion when the Panama C a n a l l i n k e d i t to t h e t r a d e r o u t e s of the w o r l d . I t i s i n t e r e s t i n g to n o t e that Vancouver p o r t a u t h o r i t i e s only commenced k e e p i n g d e t a i l e d r e c o r d s of shipping - and (166) t r a d e i n t h e y e a r 1920, t h e y e a r t h e c a n a l came i n t o a c t i v e u s e by C a n a d i a n s h i p p i n g . Such an e v e n t as t h e i n c l u d i n g of Vancouver a s a p o r t of c a l l on t h e g r e a t s h i p p i n g r o i i t e s o f the w o r l d was not o n l y i m p o r t a n t t o the c i t y , but to the whole p r o v i n c e , and t o Western Canad I t could not but b r i n g with i t new development, new c a p i t a l , new i n d u s t r i e s , and new m a r k e t s * (167) CHAPTER X I n a p p r o a c h i n g the c o n c l u s i o n o f a s t u d y such as t h i s , one 'cannot r e f r a i n from making a few s u g g e s t i o n s w h i c h might h e l p t o a l l e v i a t e t h e d i s a b i l i t i e s and a c c e n t u a t e t h e advantages of such a g i f t f r o m our n e i g h b o r s to t h e s o u t h a s the c o n s t r u c t i o n o f the Panama C a n a l , The most i m p o r t a n t work t h a t can b e done i n t h e f u t u r e i s a more e x h a u s t i v e study o f the d i s a b i l i t i e s o f the Western r o u t e to Europe, and t h i s p r o b l e m s h o u l d be approached o b j e c t i v e l y , w i t h t h e t h o u g h t ever i n mind o f u s i n g the m a t e r i a l s at hand t o t h e b e s t advantage. U n d o u b t e d l y , one o f the g r e a t e s t d i f f i c u l t i e s to be overcome i s the l a c k of s t o r a g e f a c i l i t i e s and t h e p e r i o d i c s h o r t a g e o f cargo space. I n t h e i r e f f o r t s t o f i n d a s o l u t i o n to t h i s p r oblem. Western p r o d u c e r s and e x p o r t e r s may f i n d i t n e c e s s a r y to i n v e s t i g a t e the m e r c h a n d i z i n g methods i n use i n o t h e r b u s i n e s s e n t e r p r i s e s , and p r o f i t by the e x p e r i e n c e g a i n e d i n t h o s e f i e l d s . For example, i t has been t h e custom i n c e r t a i n i n d u s t r i e s f o r the p r o d u c e r t o go t o t h e market to s e l l h i s p r o d u c t , r a t h e r t h a n to w a i t f o r the market to come t o him, American p r o d u c e r s have l e d t h e way I n t h i s method of d i s t r i b u t i o n , a p p l y i n g i t , w i t h a d m i r a b l e s u c c e s s , to t h e s a l e of automobiles, r a d i o s , machinery, and a h o s t o f o t h e r p r o d u c t s . Perhaps C a n a d i a n s s h o u l d f o l l o w t h e i r example, and move i n t o t h e w o r l d market f o r wheat, w h i c h i s c o n c e n t r a t e d i n so s m a l l an,area as to l e n d i t s e l f a d m i r a b l y t o easy e x p l o i t a t i o n , Mr, L.M. F a i r , i n h i s book, The T r o n s p o r t ^ t i o n o f Cg.ru.dicn (168) Whgat t o the Sea, makes t h i s statementt-" I t i s e s s e n t i a l t h a t t h e f l o w o f wheat f r o m H o r t h A m e r i c a t o Europe s h o u l d he c o n s t a n t , as i n Europe l a r g e s t o r a g e e l e v a t o r s a r e not u s e d i n the g r a i n t r a d e . Sheds and f l a t warehouses a r e p r o v i d e d on t h e quays, hut the g r a i n p asses q u i c k l y t h r o u g h t h e s e t o t h e m i l l e r s . ' 1 I He s e t s t h e a p p r o x i m a t e c a p a c i t y of p u b l i c s t o r a g e i n B r i t a i n a t 26 m i l l i o n b u s h e l s , and y e t B r i t a i n ' s i m p o r t s o f wheat amount t o over 200 m i l l i o n b u s h e l s a n n u a l l y . Canadians might w e l l l o o k i n t o t h i s whole p r o b l e m , w i t h an eye t o f u r n i s h i n g i n the U n i t e d Kingdom not o n l y the g r a i n , b u t t h e s t o r a g e f a c i l i t i e s and the t e c h n i c a l s e r v i c e s r e q u i r e d t o h a n d l e such a l a r g e volume o f wheat. Western p r o d u c e r s , i n p a r t i c u l a r , s h o u l d b e v i t a l l y i n t e r e s t e d i n i n v e s t i g a t i n g the p r a c t i c a b i l i t y o f such a scheme. Under such a method o f m a r k e t i n g , t h e p r o d u c e r would t h e n be I n c l o s e t o u c h , not o n l y w i t h the U n i t e d Kingdom market, b u t w i t h the e n t i r e , market of Europe, Ample s t o c k s of g r a i n c o u l d be kept on hand at a l l t i m e s ; • t h e t i m e element under hand-to-mouth b u y i n g c o n d i t i o n s would be v i r t u a l l y e l i m i n a t e d ; and more modern m e r c h a n d i z i n g methods c o u l d h e a p p l i e d . Vancouver would become m e r e l y a c l e a r i n g house f o r a l a r g e p a r t of the Canadian g r a i n c r o p ; ' t h e r i s k s w h i c h s h i p p e r s must now t a k e would be e l i m i n a t e d or r e d u c e d ; and the problems o f Inadequate l o c a l m a r k e t s , s t o r a g e f a c i l i t i e s , and u n c e r t a i n cargo space would be r e d u c e d t o a minimum. Of even more immediate i n t e r e s t t o t h e P r o v i n c e of B r i t i s h Columbia i s the p r o v i s i o n o f adequate t r a n s p o r t a t i o n f a c i l i t i e s to t h e l71?8dr"71'i^^ i a. n. j f t ^ t j b o j y ^ T o r o n t o ; , p.5. (169) Peace R i v e r D i s t r i c t . Here we have 20 m i l l i o n a c r e s of h i g h - g r a d e whea-t-producing l a n d , w h i c h s h o u l d he p o u r i n g g r a i n to w o r l d markets t h r o u g h P a c i f i c Coast p o r t s , T h i s p o t e n t i a l crop would he a v e r y welcome a d d i t i o n t o t h e p r e s e n t volume.of g r a i n c a r r i e d over the W e s t e r n r o u t e . F i n a l l y , as time goes on, the O r i e n t a l market must he developed t o t h e p o i n t where i t i s a more v a l u e h i e a d j u n c t t o t h e European t r a d e . T h i s , I n t u r n , w i l l a l l e v i a t e some o f the d i f f i c u l t i e s I n v o l v e d I n s h i p p i n g t h r o u g h the P a c i f i c C o a s t , I t v/ould seem, i n l o o k i n g hack t h r o u g h t h e m u l t i t u d e of f a c t s and f i g u r e s p r oduced i n t h i s i n v e s t i g a t i o n , t h a t we i n W estern Canada may w e l l he t h a n k f u l f o r the c o u r a g e and i m a g i n a t i o n t h a t went i n t o the h u i l d i n g o f t h e Panama C a n a l . "We have a l r e a d y seen, even at t h i s ea.rly d a t e , many o f t h e r e s u l t s of t h i s g r e a t p i e c e of e n g i n e e r i n g s k i l l , T e t the s t o r y has by no means been c o m p l e t e l y t o l d - t h e book i s s t i l l u n f i n i s h e d . We can h a r d l y c l o s e on a more a p p r o p r i a t e n o t e than t h a t sounded i n 1914 by Mr, F . J . H a s k i n , when he s a i d , "There w i l l be a sudden re™adjustment o f e x i s t i n g t r a d e r o u t e s , and t h i s m i l be f o l l o w e d by a l o n g e r a of development o f new ' c o n d i t i o n s , w h i c h w i l l be so g r a d u a l as to be almost i m p e r c e p t i b l e , and y e t so immense as t o e x c i t e the wonder o f humanity when i t stops t o r e c k o n i t s f u l l e f f e c t and m e a n i n g . " p F o r W e s t e r n Canada, t h e r e was a sudden r e - a d j u s t m e n t , and now the l o n g e r a o f development i s i n p r o g r e s s . T w e n t y - f o u r y e a r s a f t e r t h e Canal was opened, we stopped " t o r e c k o n i t s f u l l e f f e c t and meaning", and remained t o wonder a t s u c h growth i n so s h o r t a space i n t i m e . 2. H a s k i n , 3?. J . , op. c i t . , 357, P O S T S C R I P T (170) S i n c e t h e c o m p l e t i o n of t h e f o r e g o i n g s t t d y , t h e f o l l o w i n g a r t i c l e a p p e a r e d i n t h e Yancoaver D a i l y P r o v i n c e , on F e b r u a r y 1 s t , under the name o f Mr. A. C. Cummlngs, London Correspondent o f t h i s papers • • "Adequate o i l s u p p l i e s -for t h e E o y a l Navy have now been s e c r e t l y s t o r e d I n t h e U n i t e d Kingdom. E v e r s i n c e r e -armament began, q u e s t i o n s have been a s k e d i n P a r l i a m e n t and t h e p r e s s whether i n t h e event o f war t h e f l e e t t h a t g u a r d s the Empire would have s u f f i c i e n t o i l t o e n a b l e i t to keep t h e s e a s i n d e f i n i t e l y . "The Times now d i s c l o s e s t h a t the p r o b l e m o f n a v a l s u p p l i e s has been s o l v e d , and not o n l y t h i s . , h u t t h a t r e s e r v e s i n s t o r a g e have been a d e q u a t e l y p r o t e c t e d a g a i n s t a i r r a i d s . L a r g e p r i v a t e s u p p l i e s a r e a l s o a v a i l a b l e , and c o u l d be u t i l i z e d when r e q u i r e d . "There r e m a i n s t h e q u e s t i o n o f fo o d s t o r a g e , p a r t i c u l a r l y wheat. A C a b i n e t committee has drawn up a food defence p l a n , but i s s t i l l c o n s i d e r i n g what s u p p l i e s s h o u l d be s t o r e d . The t a s k o f f e e d i n g B r i t a i n i n a f u t u r e war w i l l he g r e a t e r t h a n i n 1914, as t h e p o p u l a t i o n a l r e a d y i s f o u r m i l l i o n s more, t h e merchant m a r i n e has d e c l i n e d , and t h e ac r e a g e u n d e r a g r i c u l t u r e has l e s s e n e d . "Meanwhile L o r d B e a v e r b r o o k * s newspapers have begun a crusade to f o r c e the government to a c t i o n w i t h the s l o g a n , 'Ton. ca n ' t e a t bombs,'" 1 At a l a t e r d a t e . S i r A r t h u r S a l t e r , M.P., d i s c u s s e s i n g r e a t e r d e t a i l t h e s u b j e c t o f home defence and fo o d s u p p l i e s , I n h i s a r t i c l e i n Time and: T i d e , he m e n t i o n s not o n l y t h e s t o r a g e of.wheat, but- o f a l l food s u p p l i e s , and s u g g e s t s "the government s h o u l d a i m a t s e c u r i n g food s t o c k s i n t h i s c o u n t r y e q u i v a l e n t i n f o o d v a l u e to a y e a r ' s 2 cons u m p t i o n o f wheat".. He goes on to a s s e r t t h a t any p e r s o n who makes a s t u d y o f t h e - s i t u a t i o n w i l l be f o r c e d to a d m i t : 1. Vancouver J D a i l y P r o v i n c e , F e b r u a r y 1, 1938, p. 1. 2, S a l t e r , S i r A r t h u r , 1,1.P.' "Defence - The Weakest L i n k " , Time and T i d e , March 12, 1938, p.535. ( 1 7 1 ) "(1) That t h e case f o r a c t i o n i s ' i r r e s i s t i b l e ; (2) That the remedy f o r the p r e s e n t s i t u a t i o n can be found, i n f o o d s t o r a g e w i t h o u t undue expense; (3) That t h e Government i s not g i v i n g a n y t h i n g l i k e the a t t e n t i o n to t h i s s u b j e c t w h i c h i t i m p e r a t i v e l y demands. n,? W h i l e t h e two a r t i c l e s quoted s t r e s s food s t o r a g e as a d e f e n c e measure i n case o f war, t h e y do i n d i c a t e t h a t , a l r e a d y , t h e s u b j e c t has r e c e i v e d c o n s i d e r a b l e a t t e n t i o n . A p l a n i n v o l v i n g C a n a d i a n c o - o p e r a t i o n , as s u g g e s t e d i n C h a p t e r X, might r e c e i v e v e r y f a v o r a b l e c o n s i d e r a t i o n i n Great B r i t a i n at t h e p r e s e n t t i m e . The moment seems r i p e f o r a t h o r o u g h study o f the whole s u b j e c t o f C a n a d i a n g r a i n d i s t r i b u t i o n i n the U n i t e d Kingdom. 3. S a l t e r , op. c i t , , 335. (172) BIBLIOGRAPHY GENERAL -(A) H i s t o r i c a l . Bakenhus, Reuben E. C o - a u t h o r s , Knapp, H a r r y S., and • Johnson, I.R., Ph.D., Sc.D, The.Panama C a n a l , New Y o r k , J o h n W i l e y & Sons,- I n c . , 1915. B r a d y , A l e x a n d e r . Canada. London, E r n e s t Benn L t d . , 1932. Buchan, J o h n , ( E d i t o r ) B r i t i s h A m e r i c a , ( N a t i o n s o f To-Day S e r i e s ) . B o s t o n and. New Y o r k , Haughton M i f f l i n . C o . , 1923. H a l l b e r g , C h a r l e s W i l l i a m . The Suez C a n a l , i t s H i s t o r y and D i p l o m a t i c Importance. Columbia U n i v e r s i t y , 1931. H a s k i n , F r e d e r i c k J . The Panama C a n a l , New Y o r k , Doubleday Page cc Company, 1914, M i l l s , J . Saxon, M.A. The Panama Canal - a H i s t o r y and D e s c r i p t i o n of the E n t e r p r i s e . London, Thomas N e l s o n and Sons, 1913. V i c t o r . E.A. ( E d i t o r ) . Canada's F u t u r e , Toronto', The Macro! 1 l a n Company, 1916. W i l s o n , S i r Arnold T a l b o t , The Suez C a n a l , I t s P a s t , P r e s e n t , and F u t u r e . London, O x f o r d U n i v e r s i t y P r e s s , 1935. (B) Economic. F a i r , L.M. The T r a n s p o r t a t i o n of Oanadiaji Wheat to t h e Sea. ( N a t i o n a l Problems o f Canada S e r i e s . ) M c G i l l U n i v e r s i t y Economic S t u d i e s . T o r o n t o , The Ma.cmi.llan Company. Hough,' B. O i ney. Ocean T r a f f i c and Trade. C h i c a g o , La S a l l e E x t e n s i o n U n i v e r s i t y , , 1920, I n n i s , H.A. , and P l u m p t r e , A.F.W. ( E d i t o r s ) , The Canadian Economy and i t s P r o b l e m s . T o r o n t o , The"Canadian I n s t i t u t e c T f ~ I n t e r n a t i o n a l A f f a i r s , 1954. I n n i s , Mary Q, An Economic H i s t o r y of Canada. T o r o n t o , The R y e r s o n P r e s s , 1935, Johnson, Emory E,' 5 i s t o j ^ ^ o f _ J D o a i e 3 t i c and F o r e i g n Commerce of the U n i t e d S t a t e s T Washington, D.C., The C a r n e g i e I n s t i t u t e 'of Washington, 192E, (173) BIBLIOGRAPHY, COIiTD. GMERAL -(B) JEconomic, Continued. Johnson, E.R., Ph.D. and Huebner, G.G.. Ph.D. P r i n c i p l e s o f Ocean T r a n s p o r t a t i o n , New York and London, D. Appleton and Company, 19£9, Johnson, E.R. , and Van M e t r e , 'Thurman ¥. P r i n c i p l e s of R a i l r o a d f r a n s p p r t a t i o n . New Y o r k , D, At-pleton "and" Cormsnv 1916. ~ * " " Johnson, E.R., Huehner, G.G., and W i l s o n , G, L l o y d . ?LE1J IGJJ']^-J^L- ~J :AJ}£SJ^^^JL?IL> ^ EV' "^°rk, D. A p p l e t o n and Company, 1929, MacGihhon, D.A. The Canadian G r a i n Trade, T o r o n t o , 1952. M a c K i n t o s h , W.A. Economic ProJDlenis o f the P r a i r i e P r o v i n c e s . ( V o l . I V i n Ca n a d i a n F r o n t i e r s o f S e t t l e m e n t S e r i e s -E d i t o r s , W.A. J & c K i n t o s h and l . L . G . J o e r g , ) T o r o n t o , The M a c r n i l l a n Company of Canada L t d , , 1935, Mears, E l i o t G r i m e l , M a r i t i m e Trade of Western U n i t e d S t a t e s . S t a n f o r d U n i v e r s i t y , C a l i f o r n i a , S t a n f o r d U n i v e r s i t y P r e s s , 1935. M o u l t on, Harold- G. Waterways v s . R a i l w a y s . New York, Haughton M i f f l i n Company, 1926, S m i t h , J o s e p h R u s s e l l , I n d u s t r i a l and Commercial Geography. New Y o r k , H, H o l t and Company, 1925. T a u s s i g , P.W., Ph.D. I n t e r n a t i o n a l Trade. New Y o r k , The M a c r n i l l a n Company, 1928, (174) BIBLIOGEAPHY, COMTD. M ' f l M ^ REPORTS, ETC. (A) Dominion 2u£e_aa__o f St at i s t i c s . "Canada" - O f f i c i a l Hand "bo ok, 1830-1936, "Report o f T r i a l Shipment of B u l k Wheat from Vancouver Via. Panama C a n a l t o t h e U n i t e d Kingdom." By P.J. B i r c h a r d , Onanist i n Charge, and A.W. A l c o c k , A s s i s t a n t Chemist, Ottawa, K i n g ' s P r i n t e r , 1918. "Report o f the R o y a l G r a i n I n q u i r y Commission". Ottawa,, K i n g ' s P r i n t e r , 1925. Canada Year Book - Ottawa, K i n g ' s P r i n t e r , 1900-1957, "The P r a d r i e P r o v i n c e s i n t h e i r R e l a t i o n to t h e N a t i o n a l Economy of Canada",. Ottawa, K i n g ' s P r i n t e r , December, 1934. "The Trade o f Canada", Ottawa, K i n g ' s P r i n t e r , 1919-1956. "Annual R e p o r t of t h e B o a r d of G r a i n Commissioners f o r Canada", Ottawa, K i n g ' s P r i n t e r , 1913-1936, "Trade o f Canada- - wit h B r i t i s h Empire Countries and the U n i t e d S t a t e s . " ( C o m p i l e d f o r use o f the I m p e r i a l - E c o n o m i c C o n f e r e n c e , 1932.) ' Ottawa, K i n g ' s P r i n t e r , 1932. "Twelve Y e a r s o f t h e Economic S t a t i s t i c s o f Canada", by months and y e a r s , 1919-1930, Ottawa, K i n g ' s P r i n t e r , 1931.' (B) The Economic C o u n c i l , o f B r i t i s h C o l u mbia. ( R e s e a r c h Dept.) "The Trade o f B.C. w i t h o t h e r Canadian P r o v i n c e s and w i t h F o r e i g n C o u n t r i e s . " V i c t o r i a , B.C., 1934-1935. "A Study of the C a n a d i a n R a i l w a y Rate S t r u c t u r e and i t s R e g i o n a l I n f l u e n c e I n B r i t i s h C o l u m b i a . " V i c t o r i a , . B.C., F e b r u a r y , 1936. t -"The B a r t e r Terms of Trade between E a s t e r n Canada and B r i t i s h C o l u m b i a " , V i c t o r i a , B.C., June 1935. " V a l u e of E x p o r t s and Imports a t B.C. P o r t s of E n t r y . " V i c t o r i a , B.C., November,1935, " S t a t i s t i c s o f I n d u s t r y i n B r i t i s h C o l u m b i a , 1871-1934", V i c t o r i a , B.C., November, 1935. (175) M K j L i ^ i P K Y , COMTD. ^ A M P H L E I ^ ^ ETC, (C) G e n e r a l , "Memorandum C o v e r i n g G r a i n R a t e S i t u a t i o n , as i t s t a n d s at 3 1 s t March, A. D. , 1926." V i c t o r i a , B . C . B r i t i s h C o l u mbia Government. "Harbour and S h i p p i n g " , P u b l i s h e d monthly by The Har b o u r and S h i p p i n g P u b l i s h i n g Company, Vancouver, B.C., 1918-1936. Johnson, Emory R i c h a r d . "The I n d u s t r i a l S e r v i c e s of the Hallways".' Annals o f the Ame r i c a n Academy o f P o l i t i c a l and•Social S c i e n c e . V o l . V. No.6, p.897-914. and Johnson, Emory R i c h a r d . "The Isthmian C a n a l I n i t s Economic Aspects'^. V o l . XIX, No, 1, p. 1-23, "Manual o f P r o v i n c i a l I n f o r m a t i o n " , V i c t o r i a , B.0., P r o v i n c e o f B r i t i s h Columbia, 1930. " R o y a l G r a i n I n q u i r y Commission", (Commissioners Hon. Mr. J u s t i c e Turgeon,) R e c o r d o f p r o c e e d i n g s a t Vancouver, B.C., March 3 1 s t , 1937, Volume 31. P r o p e r t y o f t h e Vancouver G r a i n Exchange. " R o y a l G r a i n I n q u i r y Commission", Ottawa, K i n g ' s P r i n t e r , 1925. " R o y a l Commission on R a i l w a y s and Tr a n s p o r t a t i o n . " Ottawa, King's P r i n t e r , 1931-32, ,Sessional P a p e r s o f the P a r l i a m e n t o f the Dominion o f - ' Canada, Ottawa, K i n g ' s P r i n t e r , 1900-1936, S t a t i s t i c a l C o n t r i b u t i o n s to Canadian Economic H i s t o r y . (2 v o l u m e s ) , T o r o n t o , The M a c n i i l l a n Company of Cans da L t d . , 19 31. The Vancouver D a i l y P r o v i n c e , Vancouver. B.C. The Vancouver D a i l y , Sun, Vaneouver, B.C. Vancouver Harbor Board Reports, 1920-1936. Vancouver P o r t Annual ~ B.C. P o r t s and Western Canada, Compiled and publishe'd by "Harbour and Shipping"„ Vancouver,, Canada. 1930. 

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