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Railway development in Canada: with particular reference to regional influences Reid, Laurens Vernon 1949

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RAILWAY DEfkLOPMIET IN CANABA; WISH PARTICJJIAB REFBHMCS TO KIOIONAL  M$WMm$  - by  umma  7 BSID.  A THESIS SUBMITTED IN PARTIAL '  UNIVERSITY OF BRITISH COLOMBIA*  A P R I L 1949, v  RAILWAY DEVELOPMENT IN CANADA: With p a r t i c u l a r reference to regional Influences;  Canadian geography and the development of Canada since Confederation have dictated that the Dominion should be divided into several almost d i s t i n c t regions with d i f f e r e n t views regarding rates f o r the transportation of t h e i r products. In t h i s essay the author endeavours to trace the history of the strong representations which the p r o v i n c i a l governments, independently  or i n groups,  have made to the Dominion Government, from time to time, regarding various f r e i g h t questions or the need f o r railway f a c i l i t i e s and also what they have attempted to do on t h e i r own behalf.  OUTLINE Foreword - Nature of the Controversy. Chapter One.  Short Regional Geography of Canada Canada Depends upon Transport. Transport before Confederation. - Publich Railway Financing i n the Maritimes - The Grand Trunk Railway, - The Waterways. Confederation, P o l i t i c a l , and Economic. • Dominion assumption of P r o v i n c i a l Debts. - R a i l Links - The All-Canada System. - Intercolonial Railway - Canadian P a o i f i c Railway Canada's Slow Growth I867 - I896 - Decline of the Maritimes. P r o v i n c i a l Railway Guarantees. - To counteract Monopoly - Manitoba. Saetatohewan, Alberta, Ontario, and B r i t i s h Columbia Venttmes. - The Manitoba Rates Agreement, 1901. Wheat. - The Canadian Northern Railway. - The Grand Trunk P a c i f i c Railway. Settlement of the P r a i r i e s . - A new Export Area. - A new role f o r Ontario, Quebec. - Tariffs. - Differentials. Railway Commissioners, 1903. Optimism and Expansion, 189© - 1903«  Chapter Two.  Overoptimism and overexpansion,. 1903. " 1911+. The Railway Act, 19GI+. Rate Disputes, I91I1., 1915. War and Wintertime. - Congestion - Financial d i f f i c u l t i e s . The Royal Commission, 1917» - Majority Report Drayton-Acworth. - Minority Report. Smith. The Canadian National Railway - A f i n a n c i a l , tangle. The Fabulous Twenties. - Railway Consolidation. - Railway Extravagance. - Automobiles, and Highways. The Railways put Emphasis on. Canada's Regionalism. - By opening New Areas, - By premitting New Industries. - By Rate Structure.  Commission t o Investigate Maritime Claims, Duncan. The Great Depression. , - The Royal Commission, 1931, Duff. - The Royal Commission, 1937* R o w e l l - S i r o i s . War. - The Railways do t h e i r share - and show a p r o f i t - increased overhead - rates frozen. Chapter Three.  A p p l i c a t i o n f o r Rate Inoreaae of 30 percent,19U6. Grant of Rate Increase of 21 percent, 19V7» A p p l i c a t i o n f o r Rate Increase, 19US. The Provinces P r o t e s t , The Maritime Case. - D i f f e r e n t i a l Eliminated by Motor t r u c k s , i n Central" Region. The C e n t r a l Region. - Manufacturing may be s u b s i d i z i n g Western Agriculture. The P r a i r i e Case. - Canada depends upon Wheat Exports. The P a c i f i c Region. - The Mountain D i f f e r e n t i a l , Dominion and P r o v i n c i a l Transport, The Dominion Case. - Answers t o P r o v i n c i a l P r o t e s t s .  Chapter Four, P o s s i b l e Future Trends, Equalization of Rates i n a l l Regions. O v e r - a l l Planning and Regulation.  FOREWORD. The economic h i s t o r y o f Canada i s l a r g e l y the h i s t o r y of the production of staple goods and t h e i r export t o f o r e i g n markets. Since the p r i c e of many of these staples i s determined i n the world market^profitable production of a s t a p l e i n Canada depends l a r g e l y upon e i t h e r cheap production by means of large scale operation or by low transporation r a t e s . Transportation should be performed i n the cheapest, most expeditious and most s a t i s f a c t o r y method.  In an endeavour t o f u l f i l  these requirements we have i n Canada a vast network of r a i l l i n e s , many thousands of miles of improved roads and a t r u l y superb water route., which has been improved by canals. The rates which transporation agencies charge f o r services i n Canada have been affected by a large number of f a c t o r s . Railway rates have been influenced by cost of operation and c o n s t r u c t i o n , volume of t r a f f i c , distance, value of service t o consumer or shipper, value of commodity and competition e i t h e r between railwyys or between d i f f e r e n t t r a n s p o r t a t i o n agencies or between shippers. Such a wide v a r i e t y of f a c t o r s leaves much room Bpr bargaining and as bargaining i s a human t r a i t there has been a n a t u r a l c o n f l i c t between the transport companies and the customers since the rates were f i r s t published.  The governments of the provinces have more  or l e s s c o n s i s t e n t l y supported the shippers of consumers w h i l s t the Dominion government has sometimes upheld the railways and sometimes seen f i t to remain a n e u t r a l a r b i t r e r .  Chapter One.  EXPANSION OF CANADIAN RAILWAYS TO 1903* Inhabited Canada i s segmentary - Maritime, Central,  P r a i r i e and P a c i f i c .  The regional bounds are not c l e a r l y marked, i n  f a c t sweeping stretches of the Pre-Cambriaa Laurentian Shield'or of almost impassable  t e r t i a r y mountains cut them o f f from each other.  In spite of national t i e s and a h i g h l y migratory population there would seem t o be four separate Anglo-Saxon cultures forming now less than a century after Confederation.  These together with French Quebeo are  Canada and might be likened to. pearls on a cord - the cord representing transport. The various products of Canada's regions must be exohanged between them or exported to world markets, hence a close second to the very production of goods i n Canada ranks t h e i r transportation. The great distances involved i n Canadian transport have been more or l e s s overcome by dredging and canalizing the splendid waterways, by the construction of railways and highways and by the recent development of airways.  Of these the railways are the most important  from a standpoint not only.of u t i l i t y but of investment. In  1  the approximate f r e i g h t o a r r i e d and approximate  t o t a l Investment.} f o r the four types of Canadian transport were* Amount  (tons)  Expenditure  2 Rail Canal Road  Air  155,000,000 22,000,000 10,000,000  1,500,000  $  3,000,000,000 330,000,000 1,000,000,000  26,000,000  These rough approximations w i l l serve t o indicate the importance of railways to Canada and to emphasize t h e i r role i n the problems of transportation.  A glance at a map of Canada w i l l i n d i c a t e the problems of Canadian marketing.  Wheat, the most important staple must t r a v e l  many hundreds of miles from the p r a i r i e l a n d before i t reaches the Canadian m i l l e r s or e l s e i t may go a d d i t i o n a l thousands of m i l e s t o the markets of Europe.  Most of the A l b e r t a wheat export and some  Saskatchewan wheat i s shipped to the P a c i f i c Coast, a t r i c k l e goes from Saskatchewan t o Hudson's Bay but most o f Saskatchewan wheat and a l l from Manitoba i s shipped to the Eastern Seaboard v i a either r a i l or ship from the Lakehead o i t i e s of F o r t W i l l i a m and P o r t A r t h u r .  Cost of transport-  a t i o n then i s an important item i n the net r e t u r n whioh the p r a i r i e farmer may obtain f o r h i s product on the world market.  This i s true  a l s o i n the case of c o a l , f i s h and potatoes from the Maritimes when seeking markets i n the other regions of Canada, or the f r u i t s or f o r e s t products of B r i t i s h Columbia when winding t h e i r way through the mountains to the east.  The manufactured goods from the favoured C e n t r a l Region  (Quebeo - Ontario) are more fortunate from a geographic p o i n t of view and are sold on a protected Canadian market. New types of t r a n s p o r t a t i o n agencies such as highway and a i r c a r r i e r s have so f a r shown that they are capable of p r o v i d i n g only c e r t a i n types of t r a n s p o r t a t i o n services more e f f i c i e n t l y than the railways.  Despite such manifestations of a i r power such as the B e r l i n  A i r L i f t and the g r e a t l y increased a i r services to Vancouver during the recent Fraser R i v e r f l o o d , i t i s almost c e r t a i n t h a t the r a i l w a y s w i l l be required t o provide most of the t r a n s p o r t a t i o n i n Canada for some years t o come.  -6P r i o r t o Confederation, 18©7» B r i t i s h North America consisted of the s t o l i d Lower Canada or Quebec, an upper Canada or Ontario struggling i n i t s f o r e s t olearings, a Maritime.region t h r i v i n g on wooden shipbuilding and a prosperous world f i s h trade, a P a o i f i o Coast bewildered by i t s p o t e n t i a l wealth and a t i n y Red River Settlement facing up to the powerful Hudson's Bay Company, to Red Indians and t o a rigorous climate.  These four colonies, .separated by vast distances  and stretching from end to end more than four thousand miles,had, l i t t l e i n common except a dependence upon Great B r i t a i n f o r protection from being absorbed intp the?growing united States of America fresh from its'enpansion i n Mexico and Alaska.  There was p r a c t i c a l l y no transport-  ation between these B r i t i s h colonies and consequently l i t t l e trade. The Reciprocity Treaty of 185k between Canada and the united States of America was terminated by the l a t t e r i n 1866  and almost  immediately conferences were c a l l e d by p o l i t i c a l leaders t o plan f o r a union of the B r i t i s h North American colonies. There were only a few miles o f railway i n B r i t i s h North Amerioa p r i o r to 1850 but railway b u i l d i n g proceeded apace, with the passage of the Guarantee Aot of 18t+9 wherein the government of the Canadas was enabled to guarantee the interest on the bonds of railway 3  companies whose lines were more than seventy miles i n length. Plans were formulated t o construct a railway from Windsor, Upper Canada, t o Halifax,. Nova Scotia ^, but when support f o r suoh a large venture was not forthcoming from the Imperial Government  5 a l i n e was b u i l t from Montreal to Toronto  .  This was the Grand Trunk  Railway? Canada's f i r s t great l i n e j b u i l t with B r i t i s h c a p i t a l to the  -76  English standard , and i t set the pattern f o r p r a c t i c a l l y a l l the railways i n the land.  By 1859 the Grand Trunk Railway extended from  Portland, Maine, t o Sarnia and by 1867;,to Chicago, I l l i n o i s .  By the  year of Confederation there were f a i r l y good r a i l connections i n the Canadas where several companies were operating i n i i s e v e E e b . . y  competition  with waterroarriers'on-'the.St. Lawrence. Lord Durham i n h i s famous report of 18ij.O had stressed the need for transport connection between the Canadas and the Maritime colonies. This idea bore no f r u i t u n t i l after Confederation,although  a l i n e had been  b u i l t from Montreal as f a r as R i v i e r e de Loup i n Lower Canada and some short precedent-setting l i n e s were being operated by the governments of New  Brunswick and Nova S c o t i a . Before Confederation then the element  of regionalism was present i n the railway organisation of B r i t i s h North America. Having purchased Alaska from the Russians i n 1867,the United States of America was e s p e c i a l l y anxious to a t t a i n the Western domains of Great B r i t a i n i n order to control the e n t i r e seaboard from Mexico t o the A r c t i c seas. S i r Frederick Bruce, B r i t i s h Minister at Washington,  7 wrote to Lord Stanley, the B r i t i s h Foreign Secretary: "It may be hopeless to think at present of opening up a route to the Pacific.  But the formation of a government over the region that extends  from Canada West (Ontario) towards B r i t i s h Columbia, including the f e r t i l e v a l l e y of the Saskatchewan River, ought not tio be delayed. "Nothing w i l l retard the tide of immigration from the North-western states across the f r o n t i e r , i f that region offers a favourable f i e l d for mining or a g r i c u l t u r a l speculation, and measures ought to be  taken without loss of time to allow of the settlement being affected i n an orderly and regular manner,..otherwise i t i s not d i f f i c u l t to foresee that the connection of Columbia with the Eastern provinces of B r i t i s h North America which i s essential, to prevent i t s annexation t o United States, w i l l run great danger of being interrupted. "The great e f f o r t s that are now being made by t h i s government, (of United States of America) to push on and complete the P a c i f i c . Railroad are a strong i n d i c a t i o n of the necessity that i s f e l t of having a c e r t a i n and expeditious commtnication with the states of the P a c i f i c and i t i s necessary f o r me t o point out the disadvantage  Coast,  at which we  should be plaoed i n the event of any d i f f i c u l t y with t h i s country, should the United States possess a direot route to the West, and should Great B r i t a i n not have sucoeeded i n opening up a similar connection between the Canadas and Columbia". The far-western colony.of B r i t i s h Columbia had bargained f o r entry into the confederation and had been offered a transcontinental 8 railway.  The Maritimes had demanded, the I n t e r c o l o n i a l ,  both were completed.  By 1888  Canada was spanned.  From i t s inception the Intercolonial Railway has been government owned.  I t was pieced together with.the New Brunswiok and  9 Nova S c o t i a government l i n e s  , the Grand Trunk Railway extension t o  R i v i e r e do Loup.and some new construction. Planned.primarily as a 10 defence measure  i t lay well to. the north of the Maine boundary  where i t passed through many miles devoid of l o c a l t r a f f i c and where i t was exposed at many points t o oheap water transport.  This railway  could not be, nor-won =i=fc., expeoted to be a profit-making venture, f o r i n addition, to i t s route d i f f i c u l t i e s i t s rate sohedule was merely an  extension of the low t a r i f f s of the former government-owned maritime c o l o n i a l railways. Provision f o r the construction of the Canadian P a c i f i o Railway was made i n a Dominion Act of 1872. ^  1  I t was  to.be a government  12 project and some work  was completed.in. the Central Region.  In  1881  13 a further Act  chartered a syndicate to construct the l i n e .  This was  the well*known " g i f t " Act when with great eclat the Dominion government gave the Canadian P a c i f i c Railway Company $25,000,000, 25,000,000 acres of land, the l i n e they had already, constructed, a monopoly of t r a f f i c south of t h e i r main l i n e west of the Great Lakes and a customs drawback allowance on construction materials.  This jgajierosityy together with  further loans combined with sound business management, and sheer hard work insured the success of the Canadian P a c i f i c Railway.  The  great  enterprise d r i l l e d , f i l l e d , blasted and bridged i t s way t o Vancouver and Donald Smith, i t s president, c^onquexed the Rocky Mountains when he drove the l a s t spike.  15  , 16  . An act of 188x4.  p r o h i b i t e d the amalgamation  of the Canadian P a c i f i c and Grand Trunk Railways opwhapiy to preclude any monopolistic tendencies.  That the govern—aits of the Dominion.- and  provinces are v i t a l l y end continually interested i n the Canadian P a c i f i c Railway i s i l l u s t r a t e d by the almost two hundred-and-fify Acts they have passed and Orders-in-Council they have promulgated i n i t s regard from  I867 to 1937. By the time of the confederation of B r i t i s h North America the United States o f America had been able t o settle i t s d i f f i c u l t i e s regarding slavery, boundaries  etc. and was then able to  concentrate upon the e s s e n t i a l l y peaceful f i l l i n g of i t s vast, vacant places with people.  Free homesteads in.the r i c h , v i r g i n . p r a i r i e l a n d  drew land-hungry Europeans and premises of p r e f e r e n t i a l treatment drew Canadians t o the newly-opened t e r r i t o r i e s to. the west of 'the Mississippi.  Instead of growing by iamigration from. Europe the  population of Canada actually declined because o f emigration, to the United States of America.  The greatest drain, was from the Maritime  Region where young men were pleased to leave,an economy based upon timber and s a i l that was collapsing under the. impact of s t e e l and steam. With the termination of the Canada-United States of America Reciprocity Treaty i n 1866 Upper Canada was forced to bend her e f f o r t s toward self-sustenance whereupon manufacturing increased i n the Central Region.  The Red River. Settlement was experimenting with  grain-growing and the forests of the P a c i f i c Region were i n t e r f e r i n g with gold mining. The Dominion Government had shown apprehension regarding railway monopoly i n I88I4.. as mentioned above 18 Act  17 and i n 1887 by i t s own  the province of Manitoba, which had blossomed from the t i n y Red  River Settlement, provided f o r the construction of the Northern P a c i f i c and Manitoba Railway which was planned as a provinci ally-owned direot competitor to the Canadian P a c i f i c Railway. The g r a i n experiments i n the Red River Settlement were successful and by 1880 the golden wheat spread as a vast waving f l o o d across the sun-drenched.prairies to the very f o o t h i l l s of the Rooky Mountains.  Immigrants arrived by the tens, of thousands from Great  B r i t a i n and a l l parts of continental Europe.  The tide, reversed from  the United States of America. Railway branch l i n e s i n the P r a i r i e Region could not be b u i l t f a s t enough t o keep pace with this.expansion and new railway  -11companies were chartered by both Dominion and provincial.governments. Messrs. Mackenzie  and Mann b u i l t , bought and bonded  many of these short p r a i r i e railways and these were amalgamated by a 19 Dominion Government Aot  into the Canadian Northern Railway.  The  i n t e r e s t on the bonds, of. t h i s company was guaranteed by en Act of the  20 Manitoba l e g i s l a t u r e  21 Saskatchewan  and l a t e r by Acts of. the l e g i s l a t u r e s of "i  22 and Alberta,, bonds of subsidiary companies w e r e guaranteed. The Grand Trunk Railway i n the Central Region became  a successful business enterprise after i t had been. enabled by a Dominion Aot  to acquire the stock of i t s p r i n c i p a l competitor, -the Great  2k Western Railway. . The l u c r a t i v e trade i n the P r a i r i e Region proved so e n t i c i n g that the Grand Trunk Railway sought permission of the Dominion  25 Government to e s t a b l i s h a subsidiary i n that region. A Dominion Aet of 19QU authorised the organisation of the Grand Trunk P a c i f i c Railway. Shortly the branch l i n e s of. the Grand Trunk Pacific. Railway with those of Canadian P a c i f i c and Canadian Northern Railways were covering the P r a i r i e Region carrying wheat l i k e mammal veins carrying l i f e b l o o d . The P r a i r i e Region had become the p r i n c i p a l export area of the Dominion by 1900. TKe.pfcairlda supported the timber industry of B r i t i s h Columbia and the manufacturing of Ontario and Quebec.  The l a t t e r  had expanded under the protective t a r i f f u n t i l they were able t o meet the new requirements.  The Maritime Region worked hard with i t s c o a l ,  i r o n smelters, f i s h i n g , f r u i t and vegetables but continued as a r e l a t i v e l y less wealthy area.with a s t a t i c population. One of the f i r s t schedules of f r e i g h t rates i n Canada was  26 published i n 1878 by the Grand Trunk Railway.  I t contained  1,391  a r t i c l e s i n carload and less-carload quantities i n eight c l a s s i f i c a t i o n s  -12as w e l l as some special l i v e s t o c k and timber r a t e s . The f i r s t c l a s s i f i c a t i o n issued j o i n t l y by the Canadian 27 Railways appeared i n 188U.  Rates were made t o s u i t the circumstances  - where i n any r e g i o n there was a large volume of t r a f f i e an a o e r t a i n commodity i t was given a reduced rate.  Thus i n the Central Region  manufactured a r t i c l e s were given preference w h i l s t i n the P r a i r i e Region s e t t l e r s ' e f f e c t s and. the primary products" o f agriculture were shipped by a less expensive rate.  This discrimination admirably suited  the p o l i c y of the Dominion. Government i n i t s e f f o r t s to b u i l d a prosperous, united nation extending from A t l a n t i c to P a c i f i c . A multitude of f a c t o r s have worked- to compose the f a b r i c of the f r e i g h t rate structure i n Canada.  Cost of overhead, conditions  of monopoly or competition and "what the t r a f f i c w i l l bear" are the outstanding features. In the maze of various rates three main types stand predominantly - standard mileage and t h e i r sat;e l i t e the t w n t a r i f f s , commodity o r special rates and competitive. The standard mileage rates are subject to much regulation by the Dominion Government.  Distances between points may be arbitrarily  shrunk and regional scales introduced.  From Montreal,. Quebec, to Saint  John, New Brunswick v i a the Canadian National Railway  (Intercolonial  route) i s 2fk miles farther than v i a the Canadian P a c i f i c Railway yet the freight rates are the same,, and from Vancouver, B r i t i s h Columbia, t o Edmonton, Alberta, the same rate applies as t o Calgary, Alberta, with a d i f f e r e n t mileage. The standard mileage rates are subject also t o the g r e a t l y discussed " d i f f e r e n t i a l s " upon which p r o v i n c i a l governments have made  -13such protest.  The four natural regions of Canada here "become f i n e  "scales", Central being divided into Central and Superior, the l a t t e r covering railways from Fort W i l l i a m to North Bay, Ontario.  With an  average f i r s t class maximum standard rate f o r seven hundred miles of  28 $2.5© per 100 pounds we f i n d from study of a map  that the Maritime  scale i s 30 percent below the average, the Central scale 10 percent below, the Superior scale 5 percent above, the P r a i r i e scale 9 percent above and the P a c i f i c scale 26 percent above. Commodity rates are s p e c i a l rates f o r products  essen-  e t d a l l y l o f a primary nature - g r a i n , l i v e s t o c k , ore, lumber, livestock feed, petroleum et cetera.  They vary from region to region according to  the amount of t r a f f i o and other factors mentioned above.  These rates  29 cover about 85 percent  of the f r e i g h t movements i n Canada.  Town t a r i f f s f a c i l i t a t e the d i s t r i b u t i o n of goods to the "hinterlands" of the larger centres.  There i s constant, almost feudal  f r i c t i o n between the various c i t i e s regarding areas of d i s t r i b u t i o n and many cases have been argued before the Board of Transport Commissioners. These rates must be made with due regard to a l l the f a c t o r s entering into general rate setting but sometimes unjust d i s c r i m i n a t i o n has inadvertently appeared.  This was the basis of the International Rates Case of  when D e t r o i t , Michigan, was  1907  able to d i s t r i b u t e certain goods i n Western  Ontario more cheaply than was Windsor, Ontario.  Mileage alone cannot  be the c r i t e r i o n and i n spite of every e f f o r t on the part of the Board of Transport Commissioners to ensure that Town T a r i f f s are as equitable as p o s s i b l e , there have been numerous claims by c i t i e s and provinces that they were being subjected to unjust d i s c r i m i n a t i o n on mileage grounds.  In a p e t i t i o n of B r i t i s h Columbia of 1922  30  there i s noted*  31  "Sugar from Vancouver and Montreal t o P r a i r i e points, From  To  Miles  Vancouver  Maclean, Sask,  Montreal  Maclean, Sask.  Rates i n cents per 100 pounds.  1133 *\6k  1750  Mileage from Montreal 3k% longer" Transcontinental f r e i g h t rates apply to goods, which might  3*2 be shipped  from Eastern Canada v i a the Panama Canal to the P a o i f i e  35 Region more cheaply than by r a i l  across Canada,  The r e s u l t i s that  c e r t a i n goods may be shipped by r a i l from Montreal, f o r example, t o Vancouver at l e s s cost than from Montreal to. Calgary, Alberta; i n f a c t there are cases where i t i s cheaper.to send goods from Montreal to  3k Vancouver and back t o Calgary than from Montreal to Calgary d i r e c t . In spite of the d i f f e r e n t categories and c l a s s i f i c a t i o n s of f r e i g h t rates throughout the Dominion each rate i s r e l a t i v e upon a l l -the  others. An increase here or a s l i g h t reduction there i s usually  r e f l e c t e d i n other rates sooner or. l a t e r . for  Since the. f i r s t rates schedule  a l l Canadian railways was published i t has been amended many times  as new conditions developed,, as new areas were opened or. as new eommod-  35 i t i e s appeared u n t i l now i t l i s t s more than 15,000 a r t i c l e s  with  e x p l i c i t instructions regarding rules and conditions of carriage and the c l a s s i f i c a t i o n appropriate to each method o f packing or easing the goods to be transferred. In return f o r a subsidy of $11,000 per mile from the (Dominion Government t o assist i n the construction of a railway from Leathbridge, Alberta,to Kelson, B r i t i s h Columbia, the Canadian P a c i f i c  36 Railway i n 1897 entered into a contract i n rates from i t s e x i s t i n g  tariff.  t o grant c e r t a i n reductions  -15This was  the f i r s t extensive change i n f r e i g h t rate  structure t o take place i n Canada.  Ten percent reductions were made i n  the rates on a g r i c u l t u r a l implements, window glass, b u i l d i n g needs, et cetera westbound from Fort William or points east and a reduction of 3 cents per 100 pounds on grains and f l o u r eastbound from Fort William or points west.  These rates were adopted by a l l Canadian railways and remained  unchanged u n t i l the g r e a t l y increased oosts due to the F i r s t Great necessitated t h e i r temporary ^suspension.  War  This Crow's Nest Pass Agreement,  as i t i s termed, had l i t t l e e f f e c t i n keeping f r e i g h t rates at a low l e v e l - i t set a maximum but the grain and f l o u r rates during i t s l i f e t i m e were well below t h i s . In 1901  the government of the Province of Manitoba  guaranteed interest payments on the bonds of the Canadian Northern  37 Railway  and i n r e t u r n secured a 15 percent reduction i n rates on a l l  conmodities vice versa.  from Port Arthur, Ontario, to a l l points i n Manitoba and The grain rate was excepted but i t was reduced from "\h cents  to 10 cents per hundred pounds.  The Canadian P a c i f i c Railway adopted the  rates of t h i s "Manitoba Agreement" and the following year reduced Sask38 atchewan and Alberta  _T_  rates by 7t percent.  This was the second general  rate change and was negotiated purely by a p r o v i n c i a l government. At the dawn of the new century Canada was prepared f o r unprecedented development.  The country had been opened l i k e an oyster,  railways had been constructed from A t l a n t i c to P a c i f i c over an a l l Canadian route which was part of an a l l - B r i t i s h route around the world. Great B r i t a i n had forgone her " L i t t l e Bnglahdism" and now  Canada, safe  behind the guns of the Royal Navy,was going to progress.  Resources  were at hand, c a p i t a l was  available and the population was  I t would be Canada's century.  arriving.  -16-  (  Footnotes to Chaper 1. Canada Year Book 19^6, 2. Including r o l l i n g  p. oljij. -  One.  700.  stock.  3. Canada Year Book 1930. p.617. I4.. Jaekman, W.T. Economic P r i n c i p l e s of Transportation. University of Toronto Press, Toronto, 1935* p.15• 5. Loo*, c i t . 6. The English standard - good quality at high oost. The American standard - f a i r quality at low oost. I f an American plan railway succeeds the maintenance as increases cost above E n l i g h standard} i f i t f a i l s losses are smaller. 7* As quoted i n the address of Premier Johnson of B r i t i s h Columbia i n h i s address at the Vancouver hearing of the Board of Transport Commissioners i n the 15 Peroent Case, November 1$£»8. Letter i n Public Reoords O f f i c e , F.O. 5/110l|. Date: January 12, I867. 8. Angus, H.F. B r i t i s h Columbia and the United States. Ryerson, Toronto. 18o2. p 235 f n . "The B r i t i s h Columbia delegation.. .to discuss...-. Confederation requested...a wagon road....the Province was promised... a P a c i f i c Railroad". 9. These were transferred to Dominion ownership by A r t i c l e 108 of the B r i t i s h North America Aot. 10. Feniam Raids,  1860,  11. Statutes of Canada, ;35 V i c t o r i a , Chaper 71. 12. To the value of about #37,000,000. Jackman pcxSt.op.cit.  p.21.  13. Statutes of Canada, l ^ , V i c t o r i a , Chapter 1. II4.. The new railway would be under the authority of the Railway Committee of the P r i v y Council. The oontraot between the government and the railway insured adequate servioe and establis hed a statutory maximum p r o f i t of ten per cent on investment. This statutory l i m i t a t i o n was removed i n 1831. 15. T r a d i t i o n says the l a s t spike was of gold but i t was an ordinary i r o n spike. See Angus H.F. B r i t i s h Columbia and the United States. Ryerson, Toronto, "\9hZ, P» 2U1. 16. Statutes of Canada, kit 17. p.  V i c t o r i a , Chapter 1.  f n 16.  18. Manitoba, 50» V i c t o r i a , Chapter U*  -1719. Statutes of Canada, $2 7-63, V i o t o r i a , Chapter 57. 20. Manitoba, 63-6U, V i o t o r i a , Chapter k» 21. Saskatchewan, 8-9, Edw*r&Yll Chapter 3. 22. A l b e r t a , 9 Edward V l l , Chapter i i * . 23. Statutes of Canada, I4.7, V i c t o r i a , Chapter 52. 24. R e a l l y Canada's pioneer r a i l w a y , established.by Statutes of Canada ks W i l l i a m IV, Chapter 29. 25. Statutes of Canada, 3, Edward Y11, Chapter 122. 26. Jackman, W.T. Economic P r i n c i p l e s _ o f Transportation. U n i v e r s i t y o f Toronto Press. Toronto, 1935, p.156. Jackman, op c i t . p. 156. 27. Loc. c i t . Jaokman, op c i t . p. 327 28. Prepared f o r the government o f B r i t i s h Columbia as p o r t i o n of i t s b r i e f presented at hearings of the Board of Transport Commissioners  i n Vancouver, B r i t i s h Columbia, November, 1948. W h i l s t t h i s map i s doubtlessly authentic i t gives but a p a r t of the complete r a i l rate picture.  29. Jackman, W.T. Economic P r i n c i p l e s of Transportation. Toronto Press, Toronto, 1935, p. 327.  U n i v e r s i t y of  30. P e t i t i o n of the Attornies-General of the Governments o f the Provinces of A l b e r t a and B r i t i s h Columbia by way of an appeal from an order of the Board of Railway Commissioners f o r Canada, June, 1922, p r o v i d i n g f o r a change i n Railway t o l l s . O r i g i n a l i n U n i v e r s i t y of B r i t i s h Columbia L i b r a r y . 31. P. 6 3fejAjja Jurjpraiil'xBtgtat.  33. Standard mileage or Commodity r a t e s . 34. Report of the Royal Commission t o i n q u i t e i n t o Dominion P r o v i n c i a l A f f a i r s , 1937, Book 11, p. i p . 35. Jackman, W.T. Economic P r i n c i p l e s of Transportation. U n i v e r s i t y of Toronto Press, Toronto, 1935, p. 157* Jackman, bp c i t . p. 157. 36. Embodied i n Statues of Canada, 60-61. V i o t o r i a , Chapter 5. 37. Manitoba, 63-64, V i c t o r i a , Chapter 4. 38. That i s , the remainder of the P r a i r i e Region. A l b e r t a were not organised u n t i l 1905.  Saskatchewan and  -18-  Chapter Two.  FURTHER EXPANSION AMD COORDINATION SINCE  1903.  The Canadian P a c i f i c Railway w i t h i t s e x c e l l e n t system of main and branch l i n e s and i t s e f f i c i e n t t e r m i n a l f a c i l i t i e s on both A t l a n t i c and P a c i f i c Oceans was a symbol of Canada at the beginning of the new century.  Aimb'st from .Its i n c e p t i o n -it-had been a f i n a n c i a l  succ©"6is'.<d>«e. largely;--to' tfie^'effects'bfstfee--«ttstbM tar-iff.." i This very :  Sttcdesis gave-'impetus to the development of competing r a i l w a y l i n e s . I f the population increase of the 1890's and e a r l y 1900 s f  was t o continue i t was more or l e s s soundly reasoned t h a t there would be i n Canada business enough f o r more than one great nationwide r a i l w a y system, a second great ocean-to-oeean l i n e together with a second network of branches and feeders to enter i n t o a healthy competition with the Canadian P a c i f i c Railway.  Popular enthusiasm f o r t h i s and other schemes 39  ran high as evidenced by a Dominion Government Act of 1911  authorising  the c o n s t r u c t i o n of the Hudson Bay, Peace R i v e r and P a c i f i o Railway t o l i n k Port Nelson, Manitoba, and P o r t Simpson, B r i t i s h Columbia. That the hazards of such an undertaking as a second t r a n s c o n t i n e n t a l , all-Canadian r a i l w a y were r e a l i z e d by the Government and by the managements of the r a i l w a y companies i s i n d i c a t e d i n the records of Dominion Government sponsored conferences h e l d between the Grand Trunk and Canadian Northern Railways i n 1903 with respect t o e i t h e r amalgamating or making the c o n s t r u c t i o n of a connecting l i n e from P o r t  ho Arthur t o North Bay a j o i n t e n t e r p r i s e . These conferences produced no agreement and  subsequently  both railways w i t h the consent and f i n a n c i a l assistance of -the Dominion Government ^  1  b u i l t l i n e s on a huge s c a l e .  Honourable A.G.  B l a i r , the  M i n i s t e r of Railways resigned his. p o r t f o l i o as a p r o t e s t against the  extravagancea of t h i s new p o l i c y of r a i l w a y expansion. Within a few years the Canadian Northern Railway under the aegis of Messrs. Mackenzie and Mann was s t r e t c h i n g from Vancouver to Winnipeg and thence v i a a Dominion Government subsidized extension t o Montreal and the combined Grand Trunk and Grand Trunk P a c i f i o Railways were extending through the Dominion Government-owned N a t i o n a l Transc o n t i n e n t a l Railway from Prince Rupert t o Moncton and t o P o r t l a n d , Maine, w h i l s t t h e i r branohes with those of the Canadian P a c i f i c Railway p a r a l l e l e d t h e i r tracks and duplicated service i n many instances throughout the various inhabited regions.  Three main l i n e s bridged the Laurentian S h i e l d  north of Lake Superior and competed f o r the i n s u f f i c i e n t t r a f f i c . Pacific  From  Kamloops t o Vancouver the Canadian Railway ran along one side o f the Fraser and the Canadian Northern ran along the other. Railway development i n Canada was an investment w i t h r e l a t i v e l y high r i s k and required large amounts of f o r e i g n c a p i t a l . P r i v a t e enterprise i n Canada could not hope t o r a i s e the large amounts required without governmental assistance.  This assistance took the form  of guaranteeing bonds which r e s u l t e d i n a heavy f i x e d i n t e r e s t charge on the r a i l w a y s and made i t almost i n e v i t a b l e -that these railways should be nationalised. 42 As Manitoba had done i n 1887 both A l b e r t a and 43 Saskatchewan railways.  guaranteed payment of i n t e r e s t on the bonds of small  Motives may have been mixed namejy a wish f o r the settlement  of new areas and a desire f o r reduoed f r e i g h t r a t e s through or n e g o t i a t i o n .  competition  These provinces had been granted a seven-and-one-half  percent reduction i n f r e i g h t rates s h o r t l y a f t e r Manitoba had negotiated for a f i f t e e n percent reduction i n the Manitoba Agreement of 1901. The f u l l f i f t e e n percent reduction was f i n a l l y granted to Saskatchewan and  -20-  A l b e r t a by the Board of Railway Commissioners a f t e r the exhaustive h e a r i n g s ^ of the Western Rates Case  45  wherein i t was deduced t h a t the f r e i g h t rates  i n the P a r a i r i e Region were j u s t i f i a b l y higher than those i n e f f e c t i n the Central Region because of the r a i l and water competition-there, y e t conditions i n the three P r a i r i e provinces, being s u b s t a n t i a l l y s i m i l a r warranted the extension of the Manitoba s c a l e t o the e n t i r e P r a i r i e  Region.  The provinces of Ontario, A l b e r t a and B r i t i s h Columbia became owners of railways i n various ways. Ontario Railway  46  The Temiskaming and Northern 4  was incorporated as a p r o v i n c i a l p r o j e c t  7  and i f i t  has' not opened new areas t o a g r i c u l t u r e as intended i t has served i n a s s i s t i n g the development of valuable mineral resources.  A l b e r t a and  B r i t i s h Columbia were f o r c e d t o take over the f i n a n c i a l l y embarrassed 48  Northern A l b e r t a and P a c i f i c Great Eastern Railways r e s p e c t i v e l y . A l b e r t a was able t o lease the Northern A l b e r t a Railway t o the Canadian National and Canadian P a c i f i c Railways but B r i t i s h Columbia i s saddled w i t h the incomplete and f i n a n c i a l l y weak P a c i f i c Great Eastern Railway. B r i t i s h Columbia had j o i n e d w i t h -the P r a i r i e Provinoes i n the demand f o r reduced f r e i g h t rates i n 1911 and the d e c i s i o n in t h e Western Rates Case regarding t h a t provinoe was t h a t the higher cost of c o n s t r u c t i o n and more expensive mountain operation made the higher r a t e s i n the P a c i f i c Region not only j u s t i f i a b l e b u t necessary.  Some reductions  49  were made t o implement a former d e c i s i o n .  The new t r a n s c o n t i n e n t a l railways had been constructed f o r -thousands of miles through unpopulated and i n many oases undevelopable  lands.  t e r r i t o r i e s , through  undeveloped  The sanguine hopes f o r new population  were temporarily dashed by the P i r s t Great War  (1914  - 1919)  the two  recently extended railway systems found the f i n a n c i a l s t r a i n of these long and unproductive l i n e s i n t o l e r a b l e .  The new and incomplete systems  were unable to cope with the huge burden of t r a f f i c and the severe winter conditions of 1916 i n i n e f f i c i e n t terminals.  r e s u l t e d i n a tangle of substandard equipment The great railways with the exception ef  the Canadian P a c i f i c appealed once again to the Dominion Government f o r  59 further loans or guarantees of interest payments on bond issues. Guarantees would have been of small a v a i l as embattled Europe required a l l available monies. In 1917  the Dominion Government appointed a Royal  Commission of three, one .Englishman^; one man from the United States of America and one Canadian,, to enquire into, railways and transportation. Mr. A.H. Smith of Hew York, president of the New  York  Central Railway and chairman of the Royal Commission was unable t o agree with the other gentlemen*.: and tabled a minority report which i n essence recommended that the Dominion Government oontinue to aid : theselunforJtunia5fce railways-financ"i"ial,ly and that c e r t a i n duplication of service on p a r a l l e l l i n e s be eliminated.  "Let the Canadian P a c i f i c alone) l e t  the Grand Trunk operate the eastern l i n e s . . . j l e t the Canadian Northern operate the western l i n e s . . . j l e t the Government operate the. connections or procure t h e i r operation by private companies)...and....look  forward  to the not distant day when the country w i l l have survived the war and  „ 51 resumed i t s prosperous growth Board of Railway Commissioners  Mr. Smith recommended.that the then concerned with .privately»owned  railway l i n e s only be given j u r i s d i c t i o n over a l l railways i n Canada i n the matters of rate regulation, s e c u r i t i e s , new cpnstruction e t c e t e r a  and the creation of a Board of Trustees to investigate the need of f i n a n c i a l or other aid to the railways, to approve of t h i s a i d and t o ensure that the Dominion Government receives s e c u r i t y for aid i n case of default.  He could not recommend tiiat the Dominion Government should  saddle i t s e l f with Canadian b i l l i o n d o l l a r railway outlay nor that a drastio change i n Government transportation policy, be made during wartime.  The continuation of Dominion Government aid would be necessary  under any plan and Mr. Smith believed that "the best results...have been obtained by the efficiency^ and economy.of private i n i t i a t i v e , energy  52 and c a p i t a l " . S i r . H.L.  Drayton of Ottawa, a f i n a n c i e r , and Mr.  W.M.  Acjtworth of London, England, an economist., recommended i n t h e i r majority report that a new  railway company be formed by the Dominion  Government i n such a manner as to ensure.its protection from the whims of party p o l i t i e s .  On various terms the Grand Trunk Railway, the Grand  Trunk P a c i f i c Railway and the Canadian northern Railway were to be taken over by the Dominion Government. and, with the I n t e r c o l o n i a l Railway and the National Transcontinental Railway, which were already Government owned, t o form the basis of the.new Dominion Railway Company. Rather than have the new  company operated by a Minister d i r e c t l y  responsible to Parliament the majority report recommended that a somewhat i d e a l i s e d n o n - p o l i t i c a l , permanent and self-perpetuating Board of Trustees be incorporated to be i n charge.  The Dominion Railway  Company would be operated on "a commercial basis*...on account of, and f o r the benefit of, the people of.Canada  .  As Chief Commissioner  Smith had done, these gentlemen recommended the extension of the authority of the Board o f Railway Commissioners t o include a l l the  -23railways i n Canada.  5k  With many other recommendations of a less  important nature the majority report terminated with recommendations  55 for management, public Railway Councils and f o r improved highways. After lengthy process of l e g i s l a t i o n an Act was passed i n 1919 incorporating the Canadian National Railway Companydirectors to be nominated by Governor-in-Council; stock t o be vested i n the Minister of Finance;... ^aiiagu*!*^)the Canadian Northern Railway, the Canadian Government Railways and a l l l i n e s that may be entrusted to i t by Grder-in-Council . n  The same year the Grand Trunk P a c i f i c Railway went into  57 Government receivership  and i n 1923 the Grand Trunk Railway was-  58 amalgamated with the Canadian National. Railway.  Eventually i n 1927  the receivership of the Grand Trunk P a c i f i e Railway was terminated  59 and i t was absorbed into the giant network. The organizing of the Canadian National Railways by the Dominion.Government precluded embarrassment f o r those provinces which, following the example of Manitoba i n ^90^ had guaranteed the i n t e r e s t l  on c e r t a i n bonds issued by railway companies when a t o t a l of $85,874,000 of the Be guarantees was incorporated into the f i n a n c i a l structure bf^the new company. As they mature these bonds.are paid.off (except some  61 guaranteed i n perpetuity) and now t o t a l about #3»000,000,  62 By the Act of 1919  the Board of Railway  was reorganised as a powerful j u d i c i a l Railway Act,  63  Regarding questions of law  Commissioners  body t o administer the 6k i t s decisions are open to  appeal t o , and t o review by, the Governor-in-Council,  Many p e t i t i o n s  from the provinces, separately or i n groups, have been heard by the Board and i t s decisions have frequently.relieved stress i n -the f i e l d s  -2kof both p o l i t i c s and economics. The Drayton-Acworth Report of 1917» although recommending the Dominion Government to take over numberous railways and with them form one huge and p h y s i o a l l y u n i f i e d system, saw no pressing need f o r the  65 s i m p l i f i c a t i o n of the oapital struoture.  In 1932 i t was reported  that i n the Canadian National Railways there were " ...one hundred and thirty-nine separate oompanies with two hundred and f i f t y - o n e d i f f e r e n t issues, requiring annually the preparation o f forty-two income accounts and ninety balance  sheets".  This confusing s i t u a t i o n p e r s i s t e d u n t i l  1937 when i t was s u b s t a n t i a l l y s i m p l i f i e d . The Fabulous Twenties J  The war to end war was over*  After a short period of f i n a n c i a l depression prosperity made i t s e l f manifest i n Canada.  The economy of the land after having been compressed  into c o n t r o l l e d channels began to expand once again.  Our great r i v a l  railway companies b u i l t new l i n e s at record-breaking  speeds almost i n  sight of each other thus continuing and intensifying unwise r i v a l r y and further duplicating servioes.  In t h i s the Canadian National Railway was  the worse offender for i t must not be forgotten t h a t the public purse was  open to t h i s company.  In one year, 1929» (& p r e - e l e c t i o n year) the  Canadian National Railway l a r g e l y by extravagance increased i t s funded  66 debt by $llj24-,000,O0O.  Luxurious coastal passenger steamships were  b u i l t and operated at great loss on the P a c i f i c .  P a l a t i a l hotels were  constructed (in c e r t a i n instances needlessly) a l l aoross Canada at a  67 t o t a l cost of $103,000,000 t o the railways.  A l l seemed r i g h t with the  world. Freight rates during t h i s period were not increased} i n f a c t , they were decreased i n the Maritime Region (by Dominion Government  ,68 subsidy of 20 percent)  and i n the P a c i f i c Region the mountain  -25d i f f e r e n t i a l was reduced.  69  There was also a small decrease i n commodity  rates. For some years Canada had operated as an economio u n i t . In a pleasant theory the c o a l , i r o n , vegetables and f i s h of the Maritime Region were exchanged f o r manufactured goods from the.Central Region. The wheat and c a t t l e of the P r a i r i e Region were exported to the world and the P r a i r i e s bought more manufactured goods from the Central Region and f i s h , f r u i t and forest products from the P a c i f i c Region.  The railways  had made the dream of the Fathers of Confederation a r e a l i t y . The great railway companies,while  uniting the provinces  and building the Canadian economy, interested themselves also i n immigrat i o n and colonization, town planning and i r r i g a t i o n , development of resources and national p u b l i c i t y , nod f f they have shown a p r o f i t i n a l l  70 these f i e l d s  they have immeasurably aided the growth and progress of  the nation i n a l l i t s regions. Curiously enough, by the very existence of the railways and with the assistance they rendered i n developing the operation of Canada as a huge unit they encouraged further regionalism by making possible l o c a l development. When the P r a i r i e Region had reached population saturation by present a g r i c u l t u r a l standards i t s demand f o r the products of the ether regions began to beoome s t a b i l i z e d .  Each region then became or endeavoured  to become a separate world trade e n t i t y once again. Whilst the Maritime Region remained almost s t a t i c i n population, trade and wealth,the Central Region began to develop i t s manufacturing to compete on a world b a s i s . Hydro e l e c t r i o power proved cheap and p l e n t i f u l  (a±*.), minerals and  forests were e a s i l y accessible and a good labour supply was at hand.  -26With an excellent transportation system and a t a r i f f - p r o t e c t e d Canadian  71 market the Central Region began to reach f o r a share- of world trade. Refrigerator ships began t o c a l l at West Coast ports to take on cargoes of f r u i t f o r Great B r i t a i n and s p e c i a l l y equipped vessels made, regular c a l l s at both A t l a n t i c and P a c i f i c coasts f o r pulp and paper w h i l s t B r i t i s h Columbia timber gained world renown.  Hundreds of m i l l i o n s of  bushels of P r a i r i e wheat s t i l l helped t o feed Europe. In addition t o the competition between the two great Canadian railwayr systems there appeared i n the 1.920.'s ca- short-haul competitor that was to develop i n t o a major menace t o the railways. This was the highway c a r r i e r . Highways are a p r o v i n c i a l matter excepting intenp r o v i n c i a l highways which, coming under the head of i n t e n - p r o v i n c i a l  72 transportation, are t h e o r e t i c a l l y under the Dominion c o n t r o l .  The  provinces have spent many millions., of d o l l a r s on highways and c o l l e c t substantial f u e l taxes and license fees from motor carrier, operators. As the railways are the concern of the Dominion GoT»rnment (with the some short provincially-contained railways, exception of ±k« ®H±HxiaxNc«x±kiaraiixHji3i Ra^fcgiu^KsafcxKHsterxn Saxrangw), i t follows that regulation of motor c a r r i e r s i n order to aid or protect railways w i l l be a cause of Dominion-Provincial  friction.  AHAeconomic short haul for a highway.carrier would seem to be about four hundred miles and as t h i s form of transport i s more convenient  than the railway i n that i t i s able t o give door-to-door  service, and,as evolution cannot be denied, i t i s quite possible that the greater percentage of short hauls f o r comparatively  small quantities  of goods w i l l be made by t h i s method, leaving a l l long and heavy hauling to the railways.  From the p o i n t o f view o f the r a i l w a y s the  important  f a c t o r of highway t r a n s p o r t a t i o n i s the f a c t t h a t i t r e s u l t s i n the d e s t r u c t i o n of t h e i r commodity d i s c r i m i n a t o r y rate system.  I n order t o  remain solvent the railways have to r a i s e r a t e s f o r s e r v i c e s t o highbulk, low-grade goods. As the demand f o r the t r a n s p o r t a t i o n o f these goods i s r e l a t i v e l y e l a s t i o t h i s i s l i a b l e not only t o c u r t a i l t h e i r movement i n the economy but a l s o perhaps t o r e s u l t i n a decline i n r a i l w a y revenue.  Regulation o f r a t e s of highway t r a n s p o r a t i o n might  be of considerable advantage i n improving the s i t u a t i o n of the r a i l w a y s p a r t i c u l a r l y during periods o f business  depression.  The great Canadian r a i l w a y extravagances o f the  nineteen-  twenties came t o an abrupt conclusion j u s t as that deoade was drawing t o a c l o s e when the i n i t i a l blow of the Great Depression f e l l i n Ootober, 1929# i n the form of a tremendous stock market crash.  This unfortunate  l a s t e d roughly f o r four years and was followed by a gradual  time  business  upswing u n t i l 1937 whan & second economic depression was experienced and p e r s i s t e d u n t i l the end of the n i n e t e e n - t h i r t i e s .  L i t t l e wonder  the deoade t o f o l l o w the Fabulous Twenties i s known as the Hungry T h i r t i e s . World trade was badly disrupted and t h i s , together w i t h poor crops returns i n the P r a i r i e Region, placed the economy of Canada i n a most unenviable position. The railways were amongst the f i r s t great Canadian i n s t i t u t i o n s to f i n d themselves i n a dilemma.  T r a f f i c declined and  revenue dropped more r a p i d l y than costs owing t o the high constant of railway operation.  costs  The large net inoctme of the Canadian P a c i f i c Railway  of nearly $62,000,000 i n 1928 f e l l t o about s#30,000,000 i n 1931 w h i l s t s i m i l a r f i g u r e s f o r the Canadian National Railway were $1(14.,500,000 and a 73 d e f i c i t o f more than $5,000,000.  - 2 8 -  S i r Henry Thoimton, head of the Board of D i r e c t o r s of the Canadian National Railways, c a l l e d the a t t e n t i o n of the Select Standing Committee on Railways and Shipping of the House of Commons to the serious p o s i t i o n of the railways and business g e n e r a l l y and recommended that a Reysgtl Commission be appointed f o r the purpose of considering the whole question of Canadian Transportation. A second Royal Commission was therefore appointed i n November, 1931. i n Canada.  t o inquire i n t o the whole problem of t r a n s p o r t a t i o n  The Right Honourable Lyman Poore Duff, P.C.  of Ottawa was  chairman of t h i s commission and although there were able economists 75 and prominent f i n a n c i e r s w i t h him on the commission  they were unable  to produce any r e a l s o l u t i o n to the vast problem. The report o f the Duff Commi s i o n o f f e r s i n a masterly s t y l e the h i s t o r y of Canadian t r a n s p o r t a t i o n enterprise and ably i l l u s t r a t e s by means of t a b l e s and graphs j u s t what was wrong w i t h the railways of Canada.  Overexpansion, unwise competition and d u p l i c a t i o n  of services and the impact of the Great Depression, they r e p o r t , were the cause of the unfortunate p l i g h t of 1931•  F r e i g h t rates were too  i n e l a s t i e t o meet w i t h motor-carrier transport and precluded prompt a c t i o n i n dealing w i t h f a l l i n g revenues. had rendered the wage scale r i g i d .  Labour contracts of the great railways The Canadian National Railway was  burdened as w e l l with the l i a b i l i t i e s of i n s o l v e n t r a i l w a y s , large 76 c a p i t a l expenditures to improve the absorbed d e t e r i o r a t e d c o n s t r u c t i o n and large scale p o l i t i c a l pressure a r i s i n g out of d i r e c t government control. The commission recommended t h a t the i d e n t i t y of the two large railway systems be maintained and t h a t the Canadian National  -29Railways be emancipated from p o l i t i c a l pressure} t h a t the two systems should co-operate and that the burdens of the Canadian National Railways be scaled t o reasonable dimensions} t h a t extravagant operation be checked and that, i n doing so, regarding the government-owned railway, the privately-owned  railway be given p r o t e c t i o n .  I t was i n d i c a t e d t h a t  the Canadian National Railway would not be able t o c a r r y i t s hugh debt from i t s earnings even under improved conditions.  The commission urged  the adoption of i t s unanimous recommendations as a p u b l i c duty t o maintain the s t a b i l i t y of the finances of Canada. The following t a b l e taken from -the r e p o r t of the Royal Commission t o i n q u i r e i n t o Dominion-provincial  Relations of 1937 ^  i l l u s t r a t e s what was happening t o the economio o r g a n i s a t i o n of Canada* P r i c e s o f 17 major exports. 1929,  July  1930,  June  1930,  December  1931,  June  1931,  December  1932, June  1932,  December  Export P r i c e s . Farm products.  "Wholesale Employment Prices Index.  Index of Industrial Production.  100  100  100  100  100  82  70  90  93  80  66  i|2  80  87  lh  62  1|2  lh  83  61+  61  41  72  80  61  3h  37  68  72  59  hi  30  66  67  52  The  railways being very c l o s e l y associated w i t h a l l the  above f a c e t s of the nation's economy were probably i n a more serious position.  By December 31# 1931* the Canadian National Railways was  attempting  to c a r r y a debt of $2,669,926,371 79  revenue o f only $2h,klh»khl»  w i t h a net  operating  The Duff Commission recommended t h a t ,  as a very s u b s t a n t i a a l part of the money invested i n the railways  comprised w i t h i n the Canadian National System must be regarded as l o s t , the c a p i t a l l i a b i l i t i e s of that railway should be h e a v i l y w r i t t e n down.  It is difficult  to understand why they should continue by stating  they considered that the time was  inopportune  to deal with t h i s  important  matter. Prom 1929  to 1939  there were few demands f o r a reduction  in.railway f r e i g h t rates made by p r o v i n c i a l governments.  The fires of  the Dominion-Provincial r a i l f r e i g h t rate controversy were as an ember compared to the dreadful conflagration of the Great Depression.  Because  of their g r e a t l y reduced revenues and v a s t l y increased s o c i a l service expenditures the provinces appealed f o r f i n a n c i a l assistance from the Dominion Government.  This aid was generously given, considering that  the Dominion Government too was  i n straitened circumstances.  As the  streams of commerce had shrunk to r i v u l e t s the doabs of t a x a t i o n had become almost desert. The recommendations of. the Duff Commission were implemented 80 to the extent of the Canadian National-Canadian P a c i f i c Act  which  provided f o r co-operation between the two systems thus ending some of the duplication of services, f o r a Board of Trustees f o r the Canadian 81 National Railways to replace the former d i r e c t o r a t e , t r i b u n a l to arbitrate differences between the railways.  and f o r a Further  implementation was given the report by the appointment of a f i r m of accountants to make a continuous audit of the finances of the Canadian 82 National Railways. 83 8k An Act of 1936 provided f o r a Board of D i r e c t o r s , seven i n number, t o manage the Canadian National Railways. Subject t o the approval of the Governor-in-Council t h i s Board of Directors was / Punjab.  Irrigated areas between r i v e r s .  to  -31choose a President.  In the debate on t h i s Aot the leader of the  Opposition emphasised the f a c t -that contrary to both the recommendations of the Drayton-Acxworth and Duff Reports the management of the Canadian National Railways was  85  very much subjected to 'the whims of  party p o l i t i c s .  86 The Canadian National C a p i t a l Revision Act of  1937  provided for the Canadian National Railways S e c u r i t i e s Trust to which was  surrendered by the Dominion Government c e r t a i n Canadian Northern  Railway Company stock and Grand Trunk Railway l i a b i l i t i e s .  Whilst  this r e v i s i o n reduced the l i a b i l i t i e s of the Canadian National Railways by $1*500,000,000 i t cannot be said that i t reduced by any appreciable amount the huge railway debt of the Dominion Government. tangle of the Canadian National Railways was  The f i n a n c i a l  somewhat s i m p l i f i e d but  the balance sheets hereafter did not give the complete picture of the proprietor's equity (the cost to the people of Canada) i n the governmentowned railway.  This Act made no contribution t o the s o l u t i o n of the  87  railway problem.  88 An Order-in-Council of 1937  appointed a Royal Commission  of distinguished Canadian economists and lawyers "to re-examine the economic and f i n a n c i a l basis of the Confederation and of the d i s t r i b u t i o n of legislathrepowers i n the l i g h t . o f the eoonomic and s o c i a l  develop-  ments of the l a s t seventy years." The Commissioners were instructed  89 "to examine public expenditures  and public debts i n general"  and  t h i s necessitated i n v e s t i g a t i o n i n t o the question of railway expenditure which had amounted to i+0 percent of the t o t a l Dominion budget i n 1932  at the depth of the Great Depression  and by 1937  was  still  consuming about 15 percent of the current revenue.of the Dominion  -32.Government. That the depth of the Canadian transport problem was almost unfathomable toward the end of the Great Depression i s indicated by the recommendations  of this Eoyal Commission,as  contained i n t h e i r  report "The Commission, has come t o consider the transportation problem of Canada one of the problems which cannot be solved without close collaboration between the Dominions and the provinces...,^it has confined i t s e l f to discussing the issues which w i l l have t o be faced, i n the hope of doing something to o l a r i f y the problem of j u r i s d i c t i o n . out,  I t points  however, the great advantage whioh might be derived from a  Transport Planning Commission which would be concerned both with planning transportation developments i n a broad way, and with f a c i l i t a t i n g the co-operation between the Dominion and the provinces i n transportation which i s necessary f o r the taxpayer. Throughout the report o f the Royal Commission the problem o f transport runs l i k e a red t h r e a d - the necessity of transport, the  sectionalism, the hugh debt burden and the effectiveness - a problem  that grew and spread with Canada.  In a study s p e c i a l l y prepared f o r  92 this Royal Commission  the question of f r e i g h t rates i s examined from  many angles. There were many causes f o r the p l i g h t of Canada's railways and these were a l l i n t e n s i f i e d i n the 193^ s. ,  Although transport  has presented i t s problems f o r a century and w i l l i n a l l l i k e l i h o o d cause many anxious times i n -the future there has been l i t t l e concerted action 93 The e f f o r t s were to apply s a t i s f a c t o r y solutions. Like small attempts to stem a r i s i n g flood when l i t t l e b a r r i e r s are thrown up here and there only to have the r e l e n t l e s s waters appear i n the gaps seeping, dripping, pouring, f l o o d i n g .  In our h i s t o r y we are a people that patch up here and there hoping f o r the b e s t muddling through,as they say i n England. r  During c r i s e s a  d i f f e r e n t story i s t o l d when we p u l l up our economy by i t s roots er dig under the v e r y foundations of our democracy that we may  strengthen  it. 1937  presented a c r i s i s .  L i t t l e b a r r i e r s had been b u i l t  i n v a i n hope t o stem the tide of depression ever since 1930*  They had  been, f o r the most part, washed away and i t seemed Canada must surely succumb to some foreign p o l i t i c a l 'philosophy>~. ?>,  . . S i r Henry Thornton  pleaded f o r help beyond the imagination of the tradition-bound Parliamentarians so they appointed a Royal Commission i n 1931  then muddled through  the deoade. The report of the 1937  Royal Commission regarding  transportation gives g r a t i f y i n g study, f o r i n broad sweeps i t mentions then passes over unpaid i n t e r e s t , constant c c s t s , c a p i t a l structures, decline i n t r a f f i c , unwise competition, lack of co-ordination, debts, depreciation, depression, world trade, bonds,.freight r a t e s , hydra-headed control, highways, labour, operating costs, politics,.motor c a r r i e r s , p r o v i n c i a l r i g h t s , private ownership, d e f i c i t s , water routes, revenues, airwayw and u n i f i c a t i o n and recommends a Transport Planning Commission. What could be simpler, more f a i r or more rational? . When the report of the Royal Commission into Dominionp r o v i n c i a l Relations was shelved i n 1940 transport of Canada.  I t was  i t was a sad day f o r the  a war casualty.  Almost overnight the railway problem, or at least i t s f i n a n c i a l aspect, disappeared.  Once again Europe was embroiled i n war  and once again Canada was doing her part. v  In 1939  the railways of  Canada were ready to assume t h e i r key role.Neither-war nor  wintertime,  nor want of funds, hindered t h i s time. The long t r a i n s of f r e i g h t r o l l e d eastward i n everincreasing volume.  The t o t a l operating revenues of the railways  1938. 1939 1940 1941 1942 1943 1944  $336,833,400 367,179,095 429,142,658 538,291,947 663,610,570 778.914,656 796,636,786  During the Second Great War  soared.  d  (1939-1946) f r e i g h t rates  i n Canada were more or less r i g i d l y controlled but u n t i l December, when they were frozen, costs mounted s t e a d i l y .  1°41,  Even after they were  frozen the Wartime Prices and Trade Board authorized c e r t a i n increases i n industrial prices.  Import and export f r e i g h t rates,insofar as they  were related t o rates to and from United States ports and i n t e r n a t i o n a l  95 through r a t e s ,  were increased following interim increases In rates  granted t o United States railways by. the Interstate Commerce Commission. U n t i l 1948 the general l e v e l of Canadian f r e i g h t rates was not increased over the reduced level established by the Board of Railway Commissioners  96 in  1922. The costs of wages and materials together added  97 $132,000,000  to the operating costs of the railways after cessation  of h o s t i l i t i e s i n Europe i n 1945 once again.  when Canadian p r i c e s began t o r i s e  The operating revenues of the railways commenced to  decline about the same time due to the deoreasing movement of war had supplies. By. 1946 this decline become s u b s t a n t i a l . Continuing the above tables  1944 $796,636,786 1 9 4 5 . . . . . . 774,971,360 1946 718,501,764 1947  770,000,000  estimated.  -35In 19U0 the combined gross operating revenues of the Canadian National and Canadian P a c i f i c Railways was roughly $3811,000,000 and produced a net operating revenue of $80,5000,000 whereas a gross operating revenue of $693,000,000 estimated f o r ^SU^ was estimated t o produce a net operating revenue of only $71*000,000 because of r i s i n g  98 operating expenses. For some sixteen years the controversy owr r a i l f r e i g h t rates between the Dominion and p r o v i n c i a l governments had been relegated to  a place of minor importance because of the gigantic struggles  against economic recession and m i l i t a r y agression. peace i n 19^6  With the coming of  the voices of sectionalism crying discrimination i n r a i l  f r e i g h t rates were again heard i n Canada.  The increase of p r o v i n c i a l  government revenues during war years and post-war years permitted the f i g h t i n g of regional rate battles on an unprecedented scale.  -36Footnotes t o Chapter  Two.  39. Statutes of Canada, 1-2-George V, Chapter 93,1911. 40. Glanebrooke, G.P. de T. A History of Transportation i n Canada, Ryerson, Toronto, P.321. 41.  In accordance with the General Subsidy Act of 1895. Statutes of Canada Grand Trunk P a c i f i c Railway guarantee - Statutes of Canada, 4 - 5 , Edward V l l , Chapter 98. Canadian Northern Railway Guarantees - Statutes of Canada 7-8 Edward V l l , Chapter 11, Statutes of Canada 1-2, George V, Chapter 12 e t c .  4 2 . Alberta, 9 , Edward V l l , Chapter 16, 43.  1909.  Saskatchewan, 2 , George V, Chapter 11,  i<4. November 14,  19f1  t o A p r i l 6,  Canadian Railway Cases, 123,  1912.  1914.  45.  17,  p. 9*  46.  Later known as the Ontario Bbrthland Railway.  47.  Ontario, 2 , Edward V l l , Chapter 9.  4 8 . B r i t i s h Columbia, 2, George V, Chapter 34. 49.  Coast C i t i e s Case, 1907.  Third Annual Report. B.R.C. 1908,  p.  133.  50. The Canadian Northern Railway requested $100,000,000 - Report of Royal Commission to inquire into Railways and Transportation i n Canada, 1917# P» xxxiv. The Grand Trunk Railway and i t s subsidiary the Grand Trunk P a c i f i c Railway requested $30,000,000 - Report of Royal Commission to inquire i n t o Railways and Transportation i n Canada, 1932, p.81. 51.  Report of the Royal Commission t o inquire into Railways and Transportation i n Canada, 1917, P. C 1 1 ,  52. Ibid. p . CV 53. Ibid. p . LXXV11 54. The Majority Report recommended that the Board of Railway Commissioners investigate minimum as well as maximum rates and thus protect the railways against cut-throat competition. 55^ Ibid, p . LXXX11 I t was costing 54^ to haul 100 pounds of grain 35 miles to B a t t l e f o r d , Saskatchewan, and only kOfi from B a t t l e f o r d v i a Port Arthur to Liverpool, England. 56. Statutes of Canada, 9"10,  George V, Chapter 13,  1919.  57. Statutes o f Canada, 9-10, George V, Chapter 22, 58.  Canada, P.C. 181, January 20, 1923.  59.  Canada, B.C. 1011, May 27, 1927.  1919.  60. Manitoba, $24,330,000j Saskatchewan, #17,904,000: A l b e r t a , $18,394,000: B r i t i s h Columbia, $25,026,000: Ontario $7,860,000 Report of Royal Commission on Dominion p r o v i n c i a l R e l a t i o n s Tolume 11, p.202. 61.  Canada Year Book  1947* p.665  62.  Statutes o f Canada, 9~10, George v . Chapter 13, 1919, As Fn 56.  63. Hence n o n - p o l i t i c a l although the Leader o f ihe Opposition i n 1956 was i n c l i n e d t o doubt t h i s . Debates, House of Commons, Canada, Session 1936, Volume 1 , p.63. 64. But not f a c t 8 . 65. Report o f the Royal Commission t o inquire i n t o Railways and Transportation i n Canada, 1932, p. 85. 66. Manion, R.J. A view of Canada's Railway Problem, Canada's Problems, Oxford U n i v e r s i t y P r e s s , Toronto, 1934* p. 15k. 67. Report of Royal Commission t o i n q u i r e i n t o Railways and Transporta t i o n i n Canada, 1932, p. 23. 68. Maritime F r e i g h t Rates A c t , Statutes of Canada, 17, George V, Chapter 144* 1927. . Annual Report, Board of Railway Commissioners, 1922, pp. 220-239. 69. General Order 366, 30 June, 1922. 70. E s p e o i a l l y the Canadian P a c i f i c Railway. 71. The w r i t e r saw made-in-Ontario M o f f a t t k i t o h e n ranges i n India. 72. B r i t i s h North America Act. B r i t i s h S t a t u t e s , 30, V i c t o r i a , Chapter 3, I867, A r t i c l e 92, 10(a). 73. Report of Royal Commission t o i n q u i r e i n t o Railways and Transportation i n Canada, 1931» P« 16. 74. P.C 2910. Canada. 75. See Appendix 6. 76. The Grand Trunk Railway was not i n good r e p a i r when t a k e n over by Canadian National Railway. December Report of Royal Commission to i n q u i r e i n t o Railways and Transportation i n Canada, 1917* p.XXIV 77. Volume 1, p. Iij4.  -3878. Report of the Royal Commission t o inquire i n t o Railways and Transportation i n Canada, 193# P* 30. 1  79. Loo c i t . 80. Statutes of Canada, 23-24, George V, Chapter 33, 1933. 81. The Board of Direotors of -the Canadian National Railways had been inaugurated to implement the Drayton-Aokwpr t h Report by the Statute of Canada, 9-10, George V, Chapter 13, 1919. 82. Statutes of Canada, 24-25, George V, Chapter 3, 1934. 83. Statutes o f Canada, 1, Edward 7111, Chapter 25, 1936. 84. The lack of continuity i n the administation of the Canadian National Railways i s possibly responsible f o r both a lack of e f f i c i e n c y i n management and a lack of a r e a l f e e l i n g of trusteeship i n the managers. Sec. Thompson, L.R. The Canadian Railway Problem, McMillan, Toronto, 1938, p.151. 85. House of Commons, Hansard, A p r i l 27, 1936, p.2201. 86. Statutes of Canada, 1, George V I , Chapter 22, 1937. 87. Thompson, L.R. op o i t p. .1035. A p i e c e of politiaG. manipulation and f i n a n o i a l i n f i d e l i t y without a p a r a l l e l . 88. Canada, P.C. 190&, August 14,  1937.  89. Ibid, Clause 3(e) 90. Report of the Royal Commission on Dominion-provincial Relations,  1940, Volume 1, p.161.  91. I b i d , Volume 111, p.275. 92. Henry, R.A.C. and Association, Railway Freight Rates i n Canada mimeographed, Ottawa, 1.939* 93* The recommendation of the Rowell-Sirois Commission has not been implemented. There i s no s a t i s f a c t o r y o v e r - a l l Transport Planning Commission i n Canada. 94. Board of Transport Commissioners f o r Canada, Judgments, Orders, Regulations and Rulings, Ottawa, A p r i l 5, 1948, p.11. 95. As f o r example from Detroit to Buffalo aoross the Ontario peninsula.-. 96. Board of Transport Commissioners, A p r i l 5, 1948, op o i t , p.7.  97. Loo c i t . 98. Ibid, p.16.  Chapter Three.  PRESENT RATE INCREASES AND On October 9# 1946,  THEIR CAUSES.  the Railway Association of Canada  on behalf of i t s member companies applied to the Board of  Transport  Commissioners for authority to increase f r e i g h t rates h o r i z o n t a l l y by  99 t h i r t y percent.  This increase would be applicable to a l l standard  mileage rates including rates from and to United States border points and rates on import and export t r a f f i c through Canadian ports moving at rates not related to rates i n e f f e c t from and to United States ports. Sueh an increase could not apply to agreed or statutory rates such as the Crow's Nest Pass rates on grain movements i n Western Canada and -these rates were not included i n the application. Rate d i f f e r e n t i a l s were to 0  be preserved as f a r as practicable and the minimum charge between any two stations f o r one hundred pounds was to be not'  les6  than seventy-five  cents. After a lengthy and searching i n v e s t i g a t i o n during which the Board of Transport Commissioners t r a v e l l e d across the Dominion conducting hearings i n many important centres and delved deeply into railway revenues, operating costs and p r o f i t s , a d e r i s i o n was given on March 30,  I9I4S.  I t allowed a horizontal rate increase of twenty-one  percent but added that i f the railways could prove t h e i r costs had r i s e n substantially within the next two years they could be  allowed  another increase without a detailed i n v e s t i g a t i o n . The minimum charge f o r a single less-than-car load shipment was t o be f o r one hundred pounds and not less than seventy-five cents. Later i n 1948 presented  100  the. Railway Association of Canada  a second application f o r permission t o increase f r e i g h t rates.  A f i f t e e n percent increase was  sought i n addition to the twenty-one  -39apercent already granted. Seven provinces had made almost immediate p r o t e s t regarding the a p p l i c a t i o n f o r the 30 percent inorease i n r a t e s .  As the  Canadian P a c i f i c Railway had been the c r i t e r i o n upon which t h i s request was based i t was s i n g l e d out f o r s p e c i a l abuse. The accounting system of the Canadian P a o i f i o Railway was perhaps open t o question and the p r o v i n c i a l governments (excepting Ontario and Quebec) were quick t o i n d i c a t e t h a t i t s estimates of r e q u i r e ments were p o s s i b l y too great.  The rented s u b s i d i a r y l i n e s were probably  being g r o s s l y overpaid*- Questions were asked regarding the p r o p r i e t y of i n c l u d i n g i n i t s estimates the costs of operation of the many outside such i n t e r e s t s wkxodt as steamships, airways, h o t e l s , telegraphs e t c e t e r a which had small connection with f r e i g h t r a t e s .  The method used by the  Canadian P a c i f i o Railway trokmftOT to allow f o r d e p r e c i a t i o n i n c l u d e s increased costs f o r prosperous years and decreased oosts f o r times of economic depression. very d i f f i c u l t .  This method i s not used by other r a i lways and i s  The seven p r o v i n c i a l governments protested regarding a l l  these matters and some others of a more minor nature.  The adequacy of  the e f f i c i e n c y of the Canadian P a c i f i c Railway accounting system seemed open to doubt and the great company, aooording t o the p r o v i n c i a l governments, wa3  not very c a r e f u l regarding i t s finances i n general. These p r o v i n c i a l governments considered also t h a t the  highway- and w a t e r - c a r r i e r competition i n a l l l i k e l i h o o d would e l i m i n a t e the proposed increase i n the c e n t r a l region and so accentuate the differentials.  -4o-  If the p r o v i n c i a l governments  101  had made great protest  during the hearings regarding the application f o r a t h i r t y percent horizontal increase i n f r e i g h t rates and regarding the decision to allow a twenty-one percent increase, they had become vociferous concerning the r i d e r providing f o r a further increase i n rates without a hearing i f the railways could prove substantial increases i n costs.  With the present-  ation of the second application f o r a rate increase they became vehement. Hearings were conducted  at important centres regarding  the f i f t e e n percent application and l o c a l problems were so magnified that a further special hearing was  conducted i n Ottawa to study the  problem of the case of B r i t i s h Columbia regarding the removal of the Mountain D i f f e r e n t i a l .  As yet no decisions have been handed down i n  these matters; Public opinion during the hearings on the for  application  a f i f t e e n percent increase i n f r e i g h t rates seemed so adverse  toward the railways that the Dominion Government deemed i t advisable  102 to appoint a t h i r d Royal Commission  headed by the Honourable W.P.A.  Turgeon, to inquire into Railways and Transportation i n Canada. Horizontal f r e i g h t rate increases are granted upon standard mileage rates only, not upon commodity rates or statutory rates by which  103 eighty-five percent of the r a i l f r e i g h t of Canada i s shipped. Shippers of wheat and other grains and g r a i n produots, timber and f o r e s t products, c o a l , f r u i t s , livestock and dairy products, i n fact shippers of p r a c t i c a l l y a l l primary products enjoy these s p e c i a l canmodity or statutory rates.  The Crow's Nest Pass Agreement of 1397  i s proof that  both the Dominion Government and the r a i l c a r r i e r s are eager to encourage  b a s i c industry by granting the lowest f r e i g h t rates consistent w i t h economical and e f f e c t i v e s e r v i c e .  I t i s the p o l i c y of t h e Dominion  Government to a s s i s t secondary i n d u s t r y by means o f the customs t a r i f f . An i l l u s t r a t i o n of the e f f e c t i v e n e s s of an increase i n f r e i g h t r a t e s can be given i n the a d d i t i o n a l charge f o r a pound of b u t t e r . Prom a given point the r a t e f o r transporting butter t o Vancouver i s 80 cents cents per 103 pounds and butter i s r e t a i l i n g i n t h a t c i t y at 7" V  &r  pound.  A 21 percent increase i n f r e i g h t rates w i l l r e s u l t i n about 1J i»cents being added f o r each 100 pounds or .17 of a cent per pound, thus r a i s i n g the p r i c e o f butter t o 70.17 cents per pound.  This increase would add  s u b s t a n t i a l l y t o the earnings o f the railways and, were i t not voiced so loudly by l o c a l p o l i t i c i a n s nor pyramided by l o c a l d e a l e r s , would pass almost unnoticed by Vancouver consumers. Regarding a lower p r i c e d commodity consider t h a t from a given P r a i r i e s t a t i o n i t costs I4.O cents t o t r a n s p o r t 1 00 pounds of wheat to tiie seabord and that wheat i s s e l l i n g f o r $1.50 per hundred pounds so r e t u r n i n g the farmer $1.10,  A f r e i g h t rate increase of 21 percent  or 8 . 4 cents per 100 pounds w i l l net the farmer only $1.01.6 per hundred pounds, a considerable decrease. The Boardl of Transport Conmissioners i s kept informed by i t s competent s t a f f o f economists and l e g a l advisors regarding the e s s e n t i a l s of any case before i t andithisainforination^wi'th thW t'ae 1  :  combined experience of i t s members, i s of great a i d i n a r r i v i n g at satisfactory decisions. U n t i l 1903 such powers as t h e Dominion Government possessed i n respect of r e g u l a t i o n and supervision of railways was exercised by a Railway Committee of the P r i v y Council.  This was a  sub-committee of the Cabinet and i t s functions and status had been defined 104 by an Act of 1868. As the bounds of the Dominion widened and the number of railways increased i t became more and more d i f f i o u l t f o r a p o l i t i c a l body such as the Railway Committee t o adjudicate between a r a i l w a y and a m u n i c i p a l i t y , a c i t i z e n or another railway without embarrassment to the Dominion Government.  The voices of s e c t i o n a l i s m were being r a i s e d  constantly regarding the p o l i t i c a l expediency or p a r t i s a n s h i p of almost a l l the orders and regulations of the Railway Committee and the need f o r an i m p a r t i a l court t o deal with matters a f f e o t i n g railways became urgent. Such a court was recommended f o r Canada i n 1898  i n the report of Professor  S.J. McLean when he was commissioned by the M i n i s t e r of Railways and Canals, Honourable A.G.  B l a i r , t o i n v e s t i g a t e the subject of r a i l w a y 105 regulations i n other c o u n t r i e s . To implement t h i s report an Act of 1905  provided f o r the a b o l i t i o n of the Railway Committee of the P r i v y Coun106  c i l and f o r the appointment of three  commissioners t o be known as the  Board of Railway Commissioners f o r Canada. 107 The Consolidated Railway Act of 1897 the Railway Committee (which was  had empowered  i n r e a l i t y an advisory body to the  Governor-General i n Council) t o approve r a i l w a y t o l l s or to reduce them, w i t h the consent of the r a i l w a y s , to produce, at t h e g r e a t e s t , a f i f t e e n 108  percent annual p r o f i t upon the c a p i t a l invested.  This power was  acquired by the Board of Railway Commissioners when i t was  formed.  The Board of Railway Commissioners had no j u r i s d i c t i o n 109 over government-owned r a i l w a y s u n t i l 1919, '*hen an Act made a l l 110 111 Canadian railways subject to i t s d e c i s i o n s . Two Acts of 1927 provided f o r the a p p l i c a t i o n of the terms of the Railway Act of 1919 and  the Maritime F r e i g h t Sates Act of 192? t o the Canadian Government 112 113 Railways by the Board of Railway Commissioners.  An Act  o f 1938  elevated the Board of Railway Commissioners i n t o a Board of Transport Commissioners w i t h a u t h o r i t y over r a i l w a y s , c o a s t a l shipping and a i r traffic. The Board of Transport Commissioners has f r e q u e n t l y stated t h a t i t s prime purpose i s t o reach decisions on the reasonableness of r a i l w a y r a t e s .  They have rendered t h e i r i n t e r p r e t a t i o n of many  aspects of the Railway Aot and such i n t e r p r e t a t i o n has been f o l l o w e d uniformly i n a l l cases coming before them.  "These r u l i n g s and i n t e r p r e -  t a t i o n s have been accepted by both shippers and c a r r i e r s as being the correct i n t e r p r e t a t i o n of the Railway Act and have never been appealed  1 or challenged by counsel f o r any i n t e r e s t as being contrary to the Act",. I t should be noted that on J u l y 7#1919» an amendment to S e c t i o n 325 of the Railway Act suspended t h e a p p l i c a t i o n of the Crow's Nest Pass Agreement f o r three years. u n t i l J u l y 7* 192i+.  This suspension was l a t e r extended^  On i t s termination the r a i l w a y s f i l e d new t a r i f f s  which were i n complete accord w i t h the Crow's Nest Pass Agreement. By t h e i r General Order, number kOB, Hie Board of Railway Commissioners disallowed these new rates on the grounds o f unjust d i s c r i m i n a t i o n since the Crow's Nest Pass Agreement rates did not apply t o l i n e s constructed since 1897*  The higher rates were then r e - i n s t a t e d and the governments  of Manitoba, Saskatchewan and A l b e r t a appealed t o the Supreme Court of Canada.  The Board of Railway Commissioners postponed the operation o f  i t s order, number lj.08, pending the d e c i s i o n of the Supreme 6ourt. The O'Courtan ruled t h a t the Board of Railway Commissioners was not empowered 116 to authorize rates i n excess of s t a t u t o r y maximum r a t e s . Although  the Manitoba Agreement had been recognised by the Dominion Government;, i t was not an Aot of the Parliament of Canada, hence not. a statutory rate and the Board of Railway Commissioners need pay i t no further heed. A rate that would be just and reasonable f o r one railway might be unjust and unreasonable f o r another, hence i t i s d i f f i c u l t f o r the Board of Transport Commissioners to arrive at the medium which w i l l , on the whole, be just and reasonable^,insofar as p o s s i b l e ^ and^ at the same time^be just and reasonable to the community which must pay the toll.  The Board of transport Commissioners takes the view that  arriving at this medium "...,,can best be accomplished by taking the requirements of the Canadian P a c i f i c Railway as the guide or measure, i n the establishment of what (B.T.C.) considers to be just and reasonabl f r e i g h t rates to be p a i d by the users of the railways. A f r e i g h t rate may be reasonable and discriminatory at $he same time.  The following c i t a t i o n s from oases which have oome  before the Board of Transport Commissioners w i l l i l l u s t r a t e t h i s point* "The Railway Aot authorizes and j u s t i f i e s discrimination.  It i s  only an undue, unfair or unjust discrimination that the law i s aimed 118 against." "The  (Railway) Act, as i t has always been interpreted by the Board,  119 only forbids discrimination when i t i s undue or unreasonable." "Mere mileage comparisons do not afford c r i t e r i a of discrimination, but a l l facts must be given weight.  In other words..mileage i s not  a yardstick of disoriminationj discrimination, i n the sense i n which i t i s forbidden by the Railway Act, i s a matter- of f a c t t o be determined „ by the Board." 1  2  0  "...the matter of detriment, i f any, t o which the applicant i s  subjected by the alleged unjust d i s c i m i n a t i o n or undue preference „121 must be considered. "One  c r i t e r i o n of unjust d i s c r i m i n a t i o n i s whether the  district  alleged to be discriminated i n favour of has p r o f i t e d at the expense of the l o c a l i t y against which i t i s alleged the d i s c r i m i n a t i o n has 122 taken place." " ... no evidence was  submitted t h a t any rate advantage possessed by  any competitor had rendered i t more d i f f i c u l t f o r the applicant company t o do business, and the a l l e g a t i o n of unjust d i s c r i m i n a t i o n was  held  „ 23 1  t o be unfounded. "The ultimate t e s t of d i s c r i m i n a t i o n i s to be found not i n d i f f e r e n c e o f rate8 but i n the question whether as a r e s u l t of t h i s d i s c r i m i n a t i o n an i n j u r y i s worked to an i n d i v i d u a l or l o c a l i t y .  One t e s t of t h i s i s  whether the l o c a l i t y alleged to be favoured gets i n t o a common market on a lower r a t e .  The rate paid rather than the distance t r a v e l l e d  121+ is  important."  The whole f r e i g h t rate structure i s honeyoombed w i t h that  rates that are exceptions t o any r u l e of e q u a l i t y ^ and t h i s c o n d i t i o n has always existed^, has been recognised and approved by a l l rate-making t r i b u n a l s and i s not contrary t o law. Rates based upon competition are not considered i n a t o r y by the Board of Transport Commissioners as the Railway Act  discrimhas  s p e c i a l provisions permitting t h i s type of rate to meet s h i p , motorc a r r i e r or other r a i l transport.  "So f a r as ... competition i s concerned,  i t has been recognised over and over again i n various decisions of t h i s Board that the exent t o which ... competition s h a l l be met i s i n the d i s c r e t i o n of the railway also been recognised  This p r i n c i p l e of water competition 125 ... by a l l r a t e - r e g u l a t i n g commissions."  has  The f i v e " s c a l e s " of the Canadian f r e i g h t rate structure have been 126 mentioned but t o r e c a p i t a t e they ares Maritime, C e n t r a l , Superior, P r a i r i e and Mountain. The governments of the Maritime provinces,  separately  or i n concert, have protested t o the Board of Transport Commissioners on numerous occasions regarding the unjustness of the f r e i g h t rates i n t h e i r region.  Their complaints, as a l l other complaints, have been  p a t i e n t l y heard and t h e i r rates adjusted.  The Duncan Royal Commission  on Maritime Claims of 1926 and the r e s u l t a n t Maritime F r e i g h t Rates 127 Aot  of the f o l l o w i n g year are evidence t h a t these p r o t e s t s were not  without a v a i l .  I t was r e a l i s e d t h a t some of the claims of the extremely  vocal element i n the Maritimes had s o l i d foundation; t h a t Canada had consoiously discriminated against t h i s r e g i o n , e s p e c i a l l y since the orgarisition of the Canadian National Railway when almost overnight the I n t e r c o l o n i a l Railway w i t h i t s p o l i t i c a l and defensive background, i t s government-absorbed d e f i c i t s and i t s patronage was changed i n t o a railway which attempted t o operate upon s t r i c t commercial p r i n c i p l e s and motives. The terms of the Maritime F r e i g h t Rates Act of 1927 provided f o r the decrease of a l l f r e i g h t r a t e s on a l l railways i n the region by twenty percent w i t h a s i m i l a r reduction i n rates on f r e i g h t consigned west of Levis or Diamond Junction (the western boundary of the Maritime s c a l e ) .  This d i f f e r e n t i a l i s c o l l e c t e d by the r a i l w a y s  from the Dominion Government thereby i n d i c a t i n g subsidized f r e i g h t r a t e s i n the Maritime region.  To-day some voices i n the Maritimes are  attempting t o prove that motor-carrier competition i n the Central region has so reduced f r e i g h t rates i n t h a t scale that the p r e f e n t i a l Maritime d i f f e r e n t i a l has been p r a o t i c a l l y eliminated.  -47, 128  Commencing with the Book T a r i f f of 1874  various  attempts were made to produoe a s a t i s f a c t o r y schedule of f r e i g h t rates i n the Central Region.  Ten years l a t e r the Canadian Standard Mileage  T a r i f f appeared and standardized the c o n f l i c t i n g rates of various railways.  With the growth of l o c a l railways the area covered by t h i s  t a r i f f was enlarged u n t i l i t included a l l the province of Quebec west of Levis and Diamond Junction and a l l the provincea of Ontario east of Capreal and Sudbury.  1884  Ten classes o f f r e i g h t were d e t a i l e d i n the  t a r i f f and the f i f t h class was used as a base. 1st Class.....200 percent of 5th Class 2nd Glass 175 percent of 5th Class 3rd Class 150 peroent of 5th Class 4th Class.....125 percent of 5th  Glass  This t a r i f f has remained the standard i n the Central Region and i n essence has been used as a model f o r the t a r i f f s i n the other regions. The f r e i g h t rate structure i n the "spout of the hopper" as Sir$ William van Horne termed the Lake Superior Region, was  devised  to f a c i l i t a t e the movement of s e t t l e r s ' e f f e c t s and f r o n t i e r necessities into the P r a i r i e Region^ and grains, e s p e c i a l l y wheat, from the P r a i r i e s to Eastern Canada.  A rate schedule was f i r s t published with the opening  of the Canadian P a c i f i c Railway i n 1885  hut s i x months l a t e r these rates  were considerably reduced because of p o l i t i c a l pressure i n the province of Manitoba.  The Superior scale i s based upon the P r a i r i e soale and  even after the 1886 reduction was Central s c a l e .  This t a r i f f was  s t i l l appreciably higher than the  applied to the Canadian Northern and  National Transcontinental Railways and i s s t i l l i n e f f e c t . In submitting the f i r s t f r e i g h t rates sohedule for the P r a i r i e Region i n 1883,  Mr. Collingwood  Schreiber, Chief Engineer  of  the Government Railways wrote* "In accordance w i t h i n s t r u c t i o n s received from the Honourable 129 Minister,  I have prepared f o r h i s consideration a f r e i g h t t a r i f f  f o r the Western D i v i s i o n of the Canadian P a c i f i c Railway. T h i s , i t w i l l be observed, i s higher than t a r i f f s of the r a i l w a y s i n Eastern Canada, but I t h i n k i t i s only i n proportion t o the comparatively greater cost of operating a railway i n the North West. ... and that the l i n e runs f o r hundreds of miles through a d i s t r i c t which, i f not wholly u n s e t t l e d , i s very sparsely s e t t l e d indeed, and which w i l l y i e l d but a very l i g h t t r a f f i c f o r some time t o come. " I have, however, borne i n mind the express wishes of t h e Honourable M i n i s t e r , t h a t the t a r i f f be framed with a view to the settlement of the country and the promotion of i t s trade. "To t h i s end low rates are placed on some of the most important a r t i c l e s , such as emigrants' e f f e c t s (one-half s p e c i a l 6th c l a s s )  „ 3° 1  c o a l , cordwood, lumber and graim. This t a r i f f w i t h f o u r merchandise and seven s p e c i a l classes remained i n e f f e c t u n t i l 1885 when a new t e n - c l a s s t a r i f f was published which was very s i m i l a r t o the Central s c a l e .  I n 1894 T a r i f f  270 was published which was r e a l l y an extension of Mr. Schreiber's o r i g i n a l to ten classes.  Although modified by the Crow's Nest Pass Agreement, 131  the Mantoba Agreement andnthe d e c i s i o n i n the Western Rates Case T a r i f f 270 i s s t i l l the basis of the P r a i r i e s c a l e .  The P r a i r i e Region  extends from Armstrong and F o r t W i l l i a m , Ontario, t o Edson and Canmore, A l b e r t a , and Crow's Next, B r i t i s h Columbia, i n c l u d i n g also the B r i t i s h Columbia Lakes D i s t r i c t . The P a c i f i c or Mountain f r e i g h t rate scale was made  -49higher than the other scales because of greater c o n s t r u c t i o n and operating expenses i n t h a t Region.  These higher r a t e s were secured by the novel  method o f applying the P r a i r i e scale t o the P a o i f i e Region and i n f l a t i n g the mileage between various p o i n t s : A c t u a l Mileage.  Published Mileage.  Vancouver t o Tale  101.9  102  Yale to Revelstoke  277  415  Revelstoke to Canmore  195.4  391  The dBi:'RilcCi. i n the Western Rates Case of 1914  ordered  the c a n c e l l a t i o n of i n f l a t e d mileages and the adoption of i n f l a t e d rates up t o a distance of 750 m i l e s , the maximum i n the r e g i o n .  Rates were  i n f l a t e d to one and one-half times the P r a i r i e scale and i n 1922,by order of the Board of Railway Cormissioners, t h i s was reduced to one 132 and one-quarter based on f o u r t h c l a s s , or about 16 percent o v e r a l l . A h o r i z o n t a l increase i n f r e i g h t rates serves t o accentuate t h i s "Mountain D i f f e r e n t i a l " . 1948  a p p l i e d t o a P r a i r i e r a t e of $1.00  The 21 percent increase of i s equal t o 21 cents w h i l s t  applied t o a comparable P a c i f i o r a t e of $1.25  i s equal to 24-25 cents.  I t should be noted t h a t w h i l s t the province of B r i t i s h Columbia i s making such great p r o t e s t s against the Mountain D i f f e r e n t i a l the provincially-owned P a c i f i c Great Eastern Railway makes use of the same P a c i f i c scale i n i t s f r e i g h t r a t e s schedule.  The province of  B r i t i s h Columbia continues to p r o t e s t against the mountain d i f f e r e n t i a l but i t i s q u i t e p o s s i b l e t h a t the province gains more from the Trans133 continental rates differential.  than i t loses i n the payment 0? the mountain  I f the mountain d i f f e r e n t i a l i s removed the failway.J i a -  w i l l i i n s a l l : likelihdoaeattemptvvtd.Iwithdraw the''Transcontinental r a t e s .  The various " s c a l e s " discussed above are appicable t o Standard Mileage Rates o n l y ; i n d i r e c t l y t o Commodity r a t e s which are 134 very low.,, and not at a l l to S t a t u t o r y r a t e s .  As has been mentioned  85 percent of r a i l c a r r i a g e i n Canada i s made under Commodity and Statutory rates. When the o r i g i n a l Schreiber f o u r - c l a s s P r a i r i e Region f r e i g h t r a t e s schedule was extended t o the ten-class T a r i f f 270 i n 1894, »  the new schedule was based upon f o u r t h c l a s s . 1st Glass......200 percent of 4 t h Class 2nd Glass .l66.2"^3rd percent o f 4 t h Class 3rd C l a s s . . . . . . 1 3 3 « " ' / 3 r d percent o f 4th Class This P r a i r i e scale was used as a standard f o r t h e  Superior and P a c i f i c scales w h i l s t the C e n t r a l scale based on f i f t h c l a s s was used as a standard f o r the Maritime s c a l e .  Thus we f i n d  that Sudbury and Capreel d i v i d e the Dominion f r e i g h t rate structure i n t o two d i s t i n c t groups.  I n the E a s t ^ f l i f t h c l a s s i s one-half f i r s t  c l a s s ; i n the West, f o u r t h c l a s s i s one-half f i r s t classy I n the East, f i r s t c l a s s i s double f i f t h c l a s s ; i n the west, f i r s t c l a s s i s double flourth c l a s s .  The Western r a t e s seem the greater e i t h e r way yet there  hasi been only vague p r o t e s t regarding t h i s aspect. '  H o r i t z o n t a l increases i n f r e i g h t r a t e s were necessary  i n Canada because of the i n f l a t i o n a r y periods of the two Great Wars. A general increase of f i f t e e n percent was allowed by 135 the Board of Railway Commissioners on December 26, 19^7* and a further increase of twenty-fiwe percent was granted by an Order-in136 Council of J u l y 27, 1918. A General Order of the Board of Railway 137 Commissioners  increased rates i n Eastern Canada by f o r t y peroent  and i n Western Canada by t h i r t y - f i v e percent on September 13, 1920.  To t h i s increase the governments of Manitoba and Saskatchewan made unavailing p r o t e s t but the same order contained a p r o v i s i o n f o r the reduction of these percentages t o t h i r t y - f i v e percent i n the East and t h d r t y percent i n the West.  A f i n a l r e d u c t i o n t o twenty-five  percent i n the East and twenty percent i n the West (that i s , over r a t e s i n a f f e c t p r i o r to September 13, 1920) was provided f o r by the Board of Railway commissioners and came i n t o e f f e c t December 1,  1921.  With the exception o f the twenty-one percent general h o r i z o n t a l increase of March 3 0 , 1948, there have been no advances i n the general l e v e l of 139 Canadian f r e i g h t rates since 1921. Railway f r e i g h t rate " s c a l e s " , although coinciding i n no instance w i t h p r o v i n c i a l boundaries, do more o r l e s s coincide with sectional interests.  These various i n t e r e s t s w h i l s t speaking w i t h a  comparatively weak voices i n the Dominion Parliament can e a s i l y be heard i n p r o v i n c i a l l e g i s l a t u r e !  The p r o v i n c i a l l e g i s l a t u r e s u s u a l l y  are pleased t o serve s u b s t a n t i a l portions of t h e i r c o n s t i t u e n t s i n a matter of such importance as r a i l w a y f r e i g h t r a t e s .  As the Dominion  Parliament c o n t r o l s these railway f r e i g h t r a t e s i t i s but n a t u r a l t h a t controversy should ensue. " i t i s not i n the nature of t h i n g s p o s s i b l e t o secure anything l i k e absolute e q u a l i t y of treatment t o a l l persons who use the r a i l w a y s , or even l i k e treatment t o a l l who are using the same r a i l w a y . The general p u b l i c have t h e o r e t i c a l l y a r i g h t to complain i f the people i n one or more sections of the country served by a p a r t i c u l a r railway are given q b e t t e r service than the people of other s e c t i o n s ; but w i t h every desire on the p a r t of the r a i l w a y company t o accord e q u a l l y f a i r t r e a t ment to a l l patrons over i t s e n t i r e system, circumstances and conditions are too c o n t r o l l i n g , oftentimes, to be r e s i s t e d or overcome." 140  -52-  Footnotes t o Chapter Three. 99» Except rates on coal and coke a^sascwhich were to be increased ass up t o and i n c l u d i n g $100 - 20^ increase. $1.00 to and i n c l u d i n g $1.50 - 3<V increase, over $1.50 - Uty increase. 100.  Board of Transport Commissioners, Judgments, Orders, Regulations and R u l i n g s , Ottawa, V o l . X X X V 1 1 1 , A p r i l 5, 1948, pp. 66-69  101. With the notable exceptions of Ontario and Quebec 102.  P.C. 6033, December 29,  1948.  103.  Jaokman, W. Economic P r i n c i p l e s of Transportation, Ryerson, Toronto, 1935, p.327.  104.  Statutes of Canada, 31, V i c t o r i a , Chapter 68,  105.  Statutes of Canada, 3, Edward V l l , Chapter 58, P a r t IV,  106.  The number of commissioners was inoreased to s i x i n 1908. of Canada, 7-8, Edward V l l , Chapter 62, 1908.  107.  Statutes of Canada,  V i c t o r i a , Chapter 9,  1868. 1903. Statutes  1897.  108. The Act incorporating the Canadian P a c i f i c Railway set i t s maximum p r o f i t at ten percent. Statutes of Canada, 44, V i c t o r i a , Chapter 1, 1881. 109. Statutes of Canada, 9-10, George V, Chapter 13, 1919. 110. With the exceptions of provincially-owned railways contained i n any one province, e.g. P a c i f i c Great Eastern Railway and Ontario Northland Railway. 111. Statutes of Canada, 17, George V, Chapter £j4,  1927.  112.  See Appendix "B" f o r the duties and j u r i s d i c t i o n of the Board of Transport Commissi oners.  113.  Statutes of Canada, 2, George V I , Chapter 53*  114.  Board of Transport C mniissioners, Rulings and Orders, Volume 38, p.47*  115.  Except on grains and f l o u r .  116.  The Crow's Nest Pass Agreement was embodied i n Statutes of Canada, 60-61, V i c t o r i a , Chapter 5, 1897.  117.  Board of Transport Commissioners, Judgments, Orders, Regulations and R u l i n g s , V o l . XXXV111, A p r i l 5, 1948, Kings P r i n t e r , Ottawa, p.36.  1938.  0  118. Canadian Railway Cases. Canadian Law Book,Company, Toronto, V o l 11  P.375.  -53-  119. I b i d , V o l . 18. -p. Ii2k 120.  '  I b i d , V o l . 27, p. 172  121. I b i d , V o l . 28, p. I l l 122. I b i d , V o l . 8 . p. 45 123. I b i d , V o l . 24, p. 177 124. I b i d , V o l . 2 0 , p.23. 125. I b i d , V o l . 15, P. 146 126. Supra. Chap 1, p.12. 127. Statutes of Canada, 17, George V, Chapter 24, 1927. 128. Henry, R.A.C. Railway F r e i g h t Rates i n Canada, Ottawa, 1939, p. 86 (mimeographed e d i t i o n , appendix t o R o w e l l p S i r o i s Report) 129. S i r Charles Tupper, K.C., M.G., C.B., M i n i s t e r o f Railways. 130. Henry, op. c i t . p. 91 131. Already described supra M3txxxibci2xJl^xi5t Chap. 1, pp. 14.15 and Chap 11, p. 20. 132. Board of Transport Commissioners, Judgments, Order, Regulations and R u l i n g s , King's P r i n t e r , Ottawa, V o l XXXV111, A p r i l 5 , 1948, p. 8 5 .  c  133. See Chapter One, page 14. 134. Supra, pc.Chap 1, p. 13. 135. Board of Railway Commissioners, General Order, 213. 136. P.C 1863, J u l y 27, 1918, Canada. 137. Board of Railway Commissioners, General Order 308. 138. Board of Railway Commissioners, General Orders, 11. B.R.C. 330. 139. Rates i n the United States of Americas have been advanced f i f t y one percent since 1946. 140. 3 , Canadian Railway Cases, pp. 259-260.  Chapter Four.  SOME FUTURE POSSIBILITIES. Gazing i n t o a e r y s t a l b a l l i s one of the more popular  pastimes f o r we are a l l i n c l i n e d to wonder what i s held i n the days or years to come. The present b u i l d s the f u t u r e out of the past so our ' c r y s t a l b a l l i s composed of h i s t o r y books, economics books and geography books. We may p r e d i c t c e r t a i n changes a f f e c t i n g t r a n s p o r t i n Canada over a period of years and i f some s u f f e r i n g student should happen upon t h i s a century hence he may be t r u l y awed at our wonderful f o r e s i g h t or he may be humoured by our innocence. Transport i s not the l i f e b l o o d of our l a n d , but i t s network i s comparable to the a r t e r i e s that c a r r y l i f e b l o o d hence any well weakening or hardening w i l l cause serious defect i n the being of the country.  I f Canada i s to cdntinue to prosper the u n r e s t r i c t e d c i r c u -  l a t i o n of our goods must continue across the land and through the years. I f the s i m i l e may be c a r r i e d f u r t h e r we may  say t h a t even  as a being has but one heart so the transport system of Canada may tend . toward a s i n g l e d i r e c t o r a t e to provide adequate c o - o r d i n a t i o n , planning, research and r e g u l a t i o n .  We are convinced that the railways have  benefited as a r e s u l t of the c e n t r i p e t a l movement of r a i l w a y regulatory bodies. The c o n t r o l of highway c a r r i e r s may g r a d u a l l y c e n t r a l i z e i n the Dominion Government and so e l i m i n a t e the confusion of various provincial jurisdictions.  A trans-Canada highway i s to be  constructed  w i t h large f i n a n c i a l assistance from the Dominion Government and perhaps t h i s w i l l r e s u l t i n some s o r t of precedent-setting nation-wide r e g u l a t i o n of motor..carriers along i t s e n t i r e length.  -55With t h e i r r e s t r i c t e d revenue the provinces are not wealthy enough t o do j u s t i c e t o the ever-growing and well-founded demand f o r b e t t e r roads, y e t any suggestion t o the e f f e c t t h a t the p r o v i n c i a l governments be shorn of t h e i r highway powers  would i n  a l l p r o b a b i l i t y produce a rare p r o v i n c i a l unanimity i n an emphatic negative. P r o v i n c i a l governments  do regulate highway c a r r i e r s  to some extent but the regulatory bodies do not provide s i m i l a r c o n t r o l s nor do they work i n co-operation w i t h the Board of Transport Commissioners.  The l a c k of c o n t r o l i n the Central Region has given r i s e t o  strong competition between the motor c a r r i e r s and the railways and t o the detriment of b o t h , f r e i g h t rates i n t h a t region have been s u b s t a n t i a l l y 145 reduced.  The c o n t r o l exercised by the p r o v i n c i a l governments i n  Manitoba, Saskatchewan and B r i t i s h Columbia has begun t o produce the desired r e s u l t o f road transport c o - o r d i n a t i o n w i t h i n the c o n t r o l l e d areas t h a t i s a healthy competition f o r the railways but not u n j u s t l y d i s c r i m i n a t o r y against them.  The h i s t o r y of the Board of Transport  Commissioners would i n d i c a t e t h a t , w i t h some augmentation, that body would be w e l l equipped t o regulate motor c a r r i e r s a l l across Canada w i t h s i m i l a r successful r e s u l t s .  To compensate the provinces f o r t h i s loss  of revenue, power and p r e s t i g e , they might be given a voice i n the s e l e c t i o n o f the members of the Board of Transport  Commissioners,  As the route of the main l i n e of the Canadian P a c i f i c Railway i s traced westward from i t s e a s t e r n terminal i n Saint John, Hew Brunswick, i t i s noted t h a t i t traverses the State of Maine emerging to cross southern Quebec t o Montreal then on t o Ottawa and F o r t h Bay, Ontario,  From Montreal a main l i n e also f o l l o w s the S t , Lawrence River  and Lake Ontario t o Toronto, whence i t taps and s u p p l i e s i t s network i n the Ontario p e n i n s u l a ; from Toronto t h i s main l i n e turns north t o junction with the Ottawa l i n e a t North Bay. A d i f f i c u l t and unproductive route, broken only by the fortunate accident of the Sudbury batholith, stretches from North Bay t o F o r t W i l l i a m but the double-tracked p o r t i o n from F o r t W i l l i a m t o Winnipeg c a r r i e s very heavy g r a i n t r a f f i c . Some o f the best and some of the l e e s f p r o d u c t i v e p r a i r i e s are crossed from Winnipeg t o Calgary then one of the most d i f f i c u l t mountain routes i s traversed wherein are encountered heavy grades and very long tunnels which i n d i c a t e high costs of c o n s t r u c t i o n and  146  operation.  The "Colossus of the North" f o l l o w s the exceedingly  f e r t i l e and prosperous Fraser V a l l e y t o reach i t s western terminal at Vancouver. The question may be asked - w i l l the great and successful Canadian P a c i f i c Railway e n t e r p r i s e continue t o prosper and maintain i t s identity?  I t l i n k s most o f the large metropolitan centres and  serves many of the b e t t e r primary and secondary i n d u s t r i a l areas but also passes through large unproductive regions and d i s t r i c t s where production would appear t o be on the d e c l i n e . The branch line6 serve well-founded and prosperous areas and w i l l presumably ensure the good fortune of the Canadian P a c i f i c Railway. Present development of Canada i s c h i e f l y t o the northward o f the main l i n e of the Canadian P a c i f i e Railway and c l o s e r t o the  147 main l i n e of the Canadian National Railways.  The water power, timber  resources and minerals o f the Laurentian Shieifl are undergoing energetic e x p l o i t a t i o n ; the r i c h e r areas of the northern p r a i r i e s the a d j o i n i n g  parkland and the Peace River country are being brought under c u l t i v a t i o n and the varied resources of northern B r i t i s h Columbia give promise of great wealth.  The former composite structure of the Canadian National  Railways has been f u l l y integrated into one huge.transportation system  11*8 which i s w e l l and e f f i c i e n t l y managed* Railways Capital Revision Act of. 1937  „ the Canadian National  g r e a t l y a l l e v i a t e d the  f i n a n c i a l burden carried by this railway.  It may be possible f o r the  present Royal Coranission to recommend further reductions i n the debt burden and so piece the f i n a n c i a l structure i n a p o s i t i o n comparable to other major railways i n North America. The future of the Canadian National Railways would seem to be promising, perhaps even to the point of giving j u s t i f i c a t i o n to the optimism of William MacKenzie, Donald Mann, A l f r e d Hays, S i r W i l f r e d  150 Laurier and the other men who worked so earnestly f o r "Canada's Century",  151 The population of Canada may increase to f i f t y m i l l i o n . Unless new v a r i e t i e s oft wheat can be developed that w i l l provide greater harvests or more intensive a g r i c u l t u r a l methods are adopted the export of wheat w i l l diminish almost t o the vanishing point  152 as p r a c t i c a l l y the e n t i r e y i e l d w i l l be consumed within,the dominion. The mines of Canada, the f o r e s t s , the o i l f i e l d s and the f i s h e r i e s w i l l doubtlessly y i e l d greater produce than at present and the railways w i l l be transporting i r o n ore from Labrador; perhaps^even from Hudson Bay or James Bay ports whence the ore has been brought from the Belcher Islands, o i l from Alberta, coal from Alberta and northern B r i t i s h Columbia, and newsprint from many areas to mention a few staples that w i l l require long, heavy and economical hauling.  I t w i l l remain  essential f o r the railways to carry wheat from the p r a i r i e s to the f l o u r  -56m i l l s which w i l l continue t o be located close t o sources of power i n both Eastern Canada and i n B r i t i s h Columbia.  Government regulated  r a i l f r e i g h t rates f o r wheat w i l l remain low t o enoourage t h i s spread of i n d u s t r y and consequent spread of population. The economic system of Canada, based upon primary founded i n d u s t r y , i s pxiSBxtoodwd upon exports t o the markets of "the world w i t h the d i r e c t r e s u l t that economic trends i n consuming areas are s h o r t l y r e f l e c t e d and perhaps even magnified i n the economy of Canada. The graph i n Appendix 1 w i l l i l l u s t r a t e d t h e great f l u c t u a t i o n s i n the p r i c e of wheat over a period of years w h i l s t wheat f r e i g h t rates during the same p e r i o d have remained f a i r l y constant.  This tends t o produce  hardships f o r the producer when the p r i c e of wheat i s low and perhaps some f i n a n c i a l d i f f i c u l t y f o r the c a r r i e r s when the p r i c e of wheat i s high.  The cost of l i v i n g index curve roughly p a r a l l e l s the l i n e repre-  senting the p r i c e of wheat i n d i c a t i n g that a l l c o s t s , i n c l u d i n g r a i l w a y operating c o s t s , r i s e as does the p r i c e o f wheat. When r a i l w a y operating expenses r i s e i t i s necessary f o r the railways to appeal to the Board of Transport Commissioners f o r an increase i n t o l l s and r a t e s . The present Royal Commission i s empowered t o review the Railway Act and may perhaps recommend a more speedy and s a t i s f a c t o r y means of e f f e c t i n g a general f r e i g h t r a t e r e v i s i o n . The present method 153 i s so long and involved  t h a t conditions may be subjected t o s u b s t a n t i a l  a l t e r a t i o n s between the date of a p p l i c a t i o n by the railway and the date of the d e c i s i o n of the Board of Transport Commissioners. P o s s i b l y a s l i d i n g scale of g r a i n f r e i g h t rates based upon a percentage of the average p r i c e of wheat f o r the previous year would serve as a p a r t i a l s o l u t i o n t o the problems of railway f r e i g h t  rates during periods of i n f l a t i o n or d e f l a t i o n . The exceedingly long and inexpensive hauls required by most large-bulk low-vflne commodities, such as wheat, would indicate that the regions wherein these commodities are produced are b e n e f i t i n g by a p r e f e r e n t i a l discrimination i n the matter of f r e i g h t rates.  This  contention i s quite p o s s i b l y true but i t cannot be proven that the railways e i t h e r make a p r o f i t or suffer a d e f i c i t because of these low commodity rates. I t can be shown that g r a i n f r e i g h t rates i n Canada are the lowest i n the world  154  and that t h i s i s part of the p o l i c y of the  Dominion Government to b u i l d a stable and prosperous economy i n the P r a i r i e Region and to provide a greater ton and mile volume of t r a f f i c  155 f o r the railways.  The only l i m i t a t i o n on these longhaul commodity  rates i s contained i n the long and short haul clause of the Railway Act, 1919»  which provides that the t o t a l charge f o r a short haul must  not exceed the t o t a l oharge for a long haul i f the short haul i s included i n the long haul. New  techniques w i l l undoubtedly evolve to increase the  e f f i c i e n c y of r a i l carriage, to speed i t and to make i t even more dependable and l e s s expensive. In Canada the railways provide c e r t a i n door to door service by the use of motor c a r r i e r s to and from stations i n the larger eentres.  In Great B r i t a i n the railways have made great e f f o r t s to  combat motor-carrier competition by means of adaptable boxes that are transferred from motor c a r r i e r to railway f l a t car and vice versa, thus eliminating costly delays of trans-shipment.  Block switching of t r a i n s  over an e n t i r e d i v i s i o n i s i n use i n some parts of Canada.  New  types of  boxcar8 may be designed to f a c i l i t a t e loading and unloading and, as the new, l i g h t - w e i g h t , strong a l l o y s become a v a i l a b l e i n great q u a n t i t y some types of f r e i g h t cars may be constructed of them.  This type of  ear would not only increase speed, safety and e f f i c i e n c y but would lessen wear and tear on r a i l w a y roadbeds. There are comparatively few miles of e l e c t r i f i e d r a i l w a y i n Canada but t h i s source of povwr may be used more e x t e n s i v e l y i n the future as more and cheaper e l e c t r i c i t y becomes a v a i l a b l e , e s p e c i a l l y i n the Central Region w i t h i t s great p o t e n t i a l i n the projected S t . Lawrence Seaway. The present Royal Commission t o i n q u i r e i n t o transporta t i o n i n Canada may be able to do much to counteract the voices of s e c t i o n a l i s m by a thorough i n v e s t i g a t i o n of complaints of economic, geographic or other disadvantages under which c e r t a i n sections of Canada f i n d themselves i n r e l a t i o n t o various t r a n s p o r t a t i o n s e r v i c e s . Some complaints may be proven groundless.  Regarding  others i t may be shown the c o n d i t i o n s causing them are t r a n s i t o r y .  A  few may be wellfounded as was t h a t of the Maritime Region i n 1926  in  which cases the commission may be able t o recommend t h a t o e r t a i n measures should be i n s t i g a t e d i n order t o a l l e v i a t e these s i t u a t i o n s . In a r r i v i n g at t h e i r d e c i s i o n i n the 30 percent case the Board of Transport Commissioners experienced great d i f f i c u l t y i n attempting a comparison of the needs of the two major r a i l w a y s as t h e i r accounting methods were at variance i n many aspeots.  Various revenues  and expenses are so shown t h a t i t i s extremely d i f f i c u l t to segregate actual t r a n s p o r t a t i o n accounts from accounts concerning h o t e l s , telegraphs etc.  The present Royal Commission has been given a u t h o r i t y t o review  these "accounting methods and s t a t i s t i c a l procedures and report upon the a d v i s a b i l i t y of adopting measures conducive to uniformity i n such matters, and upon other related problems such as depreciation  accounting,  the segregation of assets, revenues and other incomes, etc.....\y The scope of the present Royal Commission does not  157 extend to the performance o f functions  which, under the Railway Act,  are within the exclusive J u r i s d i c t i o n o f the Board of Transport  158 Commissioners.  This i s unfortunate.  That the Board has been  consistently a l e r t t o the transportation problems of Canada as they have arisen and has been judicious i n i t s decisions i s beyond question. It would perhaps be f i t t i n g t o allow the Royal Commission 48 report upon the e f f e c t of the decision of the Board of Transport Commissioners on the Canadian economy as a tribute to i t s half-century of achievement. The Royal Commission can consider the past h i s t o r y of the Board of Transport Commissioners and may recommend that i t should have wider or narrower functions or powers. Regardless of the "improvement" i n warfare by the introduction o f the atom bomb, many troops and vast quantities of material w i l l be required f o r the defence of Canada i n the event o f h o s t i l i t i e s i n the future and the Dominion Government w i l l indubitably i n s i s t that the railways are maintained i n an e f f i c i e n t  operating  condition. Comparatively small mileage of new construction i s anticipated i n the forseeable future.  A route to the i r o n deposits  of Labrador i s being studied by the government o f Quebec and the P a c i f i c Great Eastern may be completed i n B r i t i s h Columbia.  I t i s possible  the Government o f the United States of America w i l l b u i l d a railway  -60through Canada t o Alaska as a defence measure. The pioneer of transport i n Canada, the S t . Lawrence R i v e r , may be improved t o allow ocean-going shipping t o pass through to the heart of the continent. the  This would have an adverse e f f e c t on  r a i l w a y s , e s p e c i a l l y i n Eastern Canada where such water competition,  even i f seasonal, would tend t o force f r e i g h t rates down. A i r t r a n s p o r t a t i o n , e s p e c i a l l y of passengers, w i l l i n 159 a l l l i k e l i h o o d continue i t s present expansion until practically a l l the  longer journies w i l l be undertaken by t h i s means. With the exception 160  of the large areas t o the north of the populated the  stripe  of Canada  growth of the carriage of f r e i g h t by a i r w i l l be hindered by i t s  exceedingly high c o s t s . P o l i t i c a l influence i n the crude sense has l a r g e l y disappeared from the a f f a i r s of both the Canadian P a c i f i c and Canadian National Railways. For more than twenty years there has been no new statutory rate and the l a s t one imposed (the Maritime Freight Rates Act  of 1927) d i d not r e s u l t i n a reduction o f railway revenue.  Control  of f r e i g h t rates by the Board o f Transport Commissioners has been an important part of Dominion p o l i c y and w i l l continue as such, but t h i s c o n t r o l has at no time created great f i n a n c i a l disadvantage f o r e i t h e r the  railways or the users. For  many years the r a i l w a y s , protected by the Dominion  customs t a r i f f , encouraged by defence p o l i c y and secure under the judgments, order, r u l i n g and regulations of the Board of Transport Commis sioners w i l l continue t o p l a y the dominant r o l e i n Canadian transportation.  The other forms of t r a n s p o r t a t i o n w i l l remain i n  purely secondary, i f important, p o s i t i o n s whioh w i l l become more worthy  as the trend toward c e n t r a l i z e d c o n t r o l and regulations advances. F r e i g h t rates i n the various "scales" have shown a tendency toward e q u a l i z a t i o n .  Appendix F i l l u s t r a t e s t h a t , w i t h  exoeption of the Maritime scale^there between any two scales.  the  i s no very great difference  The decreases of 1921  and 1922  were e s p e c i a l l y  effeotive i n furthering this equalization. U l t i m a t e l y a u n i f i e d c o n t r o l of transport and a f a i r l y equalized f r e i g h t rate structure through Canada may  produce harmony  between the Dominion and the p r o v i n c i a l governments.  -64Footnotes t o Chapter Four. 141. This was recommended i n the Report of the Royal Commission i n t o Dominion-Provincial R e l a t i o n s , 1937, Volume 1 1 , p. 275. Almost a l l major reforms i n the administration and r e g u l a t i o n of Canadian transport have been recommended by Itoyal Commission Reports. A B i l l "to e s t a b l i s h a Board of Transport Commissioners with authority i n respect o f transport by r a i l w a y s , s h i p s , a i r c r a f t and motor-vehicles" was introduced i n t o the Senate of Canada on February 2, 1937(a). This B i l l was r e j e c t e d by the Senate on March 18, 1937, o h i e f l y because i t was h e l d that much shipping on the Great Lakes would be unable t o function under any r e g u l a t i o n , and because 98 percent of highway t r a n s p o r t a t i o n i s i n t r a - p r o v i n c i a l and, t h e r e f o r e , by the accepted i n t e r p r e t a t i o n of the B r i t i s h North America A c t , I 8 6 7 , tinder the j u r i s d i c t i o n o f the p r o v i n c i a l governments. The Transport Act of 1938(b) was introduced i n t o the House of Commons on March 1 , 1938, as "an Act t o e s t a b l i s h a Board of Transport Commissioners f o r Canada w i t h a u t h o r i t y i n respect of r a i l w a y s , ships and a i r c r a f t " . This became law June 3°» 1938. Control o f a i r c r a f t was vested i n the Department of Munitions and Supply i n 1944. (c) (a) Canada, Debates of the Senate, February 2, 1937, P» 50 Senator Dandurand. (b) Statutes of Canada, 2 , George V I , Chapter 53, 1938. (c) Statutes of Canada, 8, George V I , Chapter 28, 1944. See also Appendix H. 142.  By Dominion Government d e c l a r i n g a l l roads f o r the general advantage of Canada by Seotion 92: 10: (B) o f B r i t i s h North America Aot. 143. Manitoba, Saskatchewan and B r i t i s h Columbia. 144.  P r o v i n c i a l highwayregulations do tend t o r e s t r i c t rate competition i n t h e i r areas.  145.  Supra. Maritime c l a i m s , Chapter Three, p. 46  146.  Angus, H.F. B r i t i s h Columbia and the United S t a t e s , Ryerson, Toronto, 1942, p. 23I4., f n . 9. Eight mountain passes l i s t e d from an e a r l y survey. Name  1. Yellowhead 2. Howse K i c k i n g Horse Vermillion 5. Kananaskis  Location  Altitude  Athabaska t o Fraser Red Deer t o Columbia Bow t o Columbia Saskatchewan to Kootenay Bow to Kootenay  3,760 f e e t . 6,347 f e e t . 5,420 f e e t . 4,947 f e e t . 5,985 f e e t .  game  Location  6. Crow's Nest 7. B r i t i s h Kootenay 8. Red Stone Creek  Crow to Kootenay Railway to Kootenay Waterton t o Kootenay  Altitude 5*985 f e e t 5,960 f e e t 6,030 f e e t  (1. Used by Canadian National Railways, 3 and 6. Used by Canadian P a c i f i c Railways) 147« Supra.  Chapter 11, p. 19  l i | 8 . Board o f Transport Commissioners, Judgments, Orders, Regulations and Rules, Volume XXXV111, Ottawa,- A p r i l 5, 1948, pp. 17-18 Operating Rates f o r 1946* Canadian National Railways - 88, 23. Canadian P a c i f i c Railways - 86, 50. 149.  Statutes o f Canada, 2, George V I , Chapter 22, 1937. I n t e r e s t payable t o the Government reduced by $35,000,000 annually on monies advanced by the Parliament of Canada to the Canadian National Railways to defray operating expenses incurred p r i o r to 1937 — Board of Transport Commissioners, op. c i t . p. The f i x e d charges of the two railways are* Canadian National Railways - $45,000,000 annually Canadian P a c i f i c Railways - $18,000,000 annually  150.  The e f f o r t toward'Canada's Century' provided the Dominion w i t h three t r a n s c o n t i n e n t a l r a i l w a y s . The United States of America s t i l l has no t r a n s c o n t i n e n t a l railway.  15L T a y l o r , G r i f f i t h , Canada, Methuen, London, 1947, P» 516. 152.  U.S. wheat production - 1,155,000,000 bushels. 1946 small export. U.S. Population 131,669,275 - 1946. Canadian wheat production - 352,214,000 bushels. 1947. Probable Canadian population - 50,000,000 (fn 151) Even with g r e a t l y increased wheat production the r a t i o would i n d i c a t e only a small export o f t h i s commodity. F i g u r e s , except probable Canadian population from the Statesman's Year Book, 1948. MacMillan, London.  15P.  30 percent Case : A p p l i c a t i o n , October 9, 1946, Deoision, March  154.  Henry, op. c i t . p. 284  30, 1948.  47  155.  c f . Schreiber T a r i f f , p. ijfifcand Crow's Nest Pass Agreement, p. 1  156.  P.C. 6033 December 19, 1943.  157.  Appendix B.  158.P.C. 6033, jpaxagaqofcx^.December 19, 1948, para. 5.  159. 1940 - i4o,025i 1941 - 208,059) 1942 - 299,047* 1945 - 514,642 19144 - 403,938, 1945 - 525,407. Canada Year Book, 1947,  p. 720.  1946 - 836,548, 1947 - 1,045,829. C i v i l Aviation i n Canada, 1947. 1,200,000 estimated.  King's P r i n t e r , Ottawa,  1948,  160. Populated Canada i s about 3000 miles i n length and about 600 miles wide at i t s greatest width i n Alberta.  -6 7  APPENDIX A. The B r i t i s h North America Act, I867, 30 - 31, V i o t o r i a , Chapter March 29,  3,  I867. Sections relevant to t r a n s p o r t a t i o n .  9 1 . . . . . . . i t i s hereby declared t h a t (notwithstanding anything i n t h i s Afct) the e x c l u s i v e L e g i s l a t i v e A u t h o r i t y of the Parliament of Canada extends t o a l l Matters coming w i t h i n the c l a s s e s of Subjects next h e r e i n a f t e r enumerated, t h a t i s to say: 2. The Regulation of Trade and Commerce.  s  10. Navigation and Shipping. 29.  Such classes of Subjects as are expressly excepted i n the Enumeration of the Classes of Subjects by t h i s Act assigned e x c l u s i v e l y t o the L e g i s l a t u r e s of the Provinces.  And any matter coming w i t h i n any of the Classes of Subjects enumerated i n t h i s s e c t i o n s h a l l not be deemed to come w i t h i n the Class of Matters of a Looal or P r i v a t e Nature comprised i n the Enumeration of the Classes of Subjects by t h i s Act assigned e x c l u s i v e l y t o the L e g i s l a t u r e s of the Provinces. 92.  In each Province the L e g i s l a t u r e may e x c l u s i v e l y make Laws i n r e l a t i o n to Matters w i t h i n the Classes of Subjects next h e r e i n a f t e r  enumerated, that i s t o say : 10.  Local Works or Undertakings other than such as are of the fblbwing c l a s s e s . a) Lines of Steam or other Ships, Railways, Canals, Telegraphs, and other works and Undertakings connecting the Province w i t h any other or others of the P r o v i n c e s , or extending beyond the L i m i t s of the Province. b) Lines of Steam Ships between the Province and any B r i t i s h  11 or Foreign Country, c) Such Works as, although wholly s i t u a t e w i t h i n the Province, are before or a f t e r t h e i r Execution declared by the Parliament of Canada t o be f o r the general advantage of Canada or f o r the advantage of Two or more of the Provinces, 13,  Property and C i v i l Rights i n the Province.  16.  Generally a l l Matters of a merely l o c a l or p r i v a t e Nature i n the Province.  108.  The P u b l i c Works and Property of each Province, enumerated i n  the T h i r d Schedule to t h i s A c t , s h a l l be the Property of Canada. The Third Schedule. 1. Canals, with Lands and Water Power connected therewith. 2. P u b l i c Harbours. 3.  .....and P i e r s . . . . . .  1+, Steamboats, Dredges and P u b l i c Vessels. 5 . Rivers and Lake Improvements. 6. Railways and Railway Stocks, Mortgages and other Debts due by Railway Companies. 7 . M i l i t a r y Roads. 9  .Ordnance Property.  Ill APPENDIX B. Summary of the general j u r i s d i c t i o n and powers of the Board of Transport  Commissioners.  1. The Board has f u l l j u r i s d i c t i o n t o i n q u i r e i n t o and decide any complaint a r i s i n g out of, or i n connection w i t h , the operation of the Railway Act or any S p e c i a l Act, or any r e g u l a t i o n or order made thereunder by any l a w f u l a u t h o r i t y , and has s i m i l a r a u t h o r i t y regarding any request made t o the Board t h a t the l a t t e r should make any order f o r , or give i t s sanction OJJ approval t o , anything r e q u i r e d or p r o h i b i t e d under the l e g i s l a t i o n . 2. I t may order a r a i l w a y company or a person subject t o the Act t o do or t o cease doing anything required or forbidden by the Act. In t h i s i t has f u l l j u r i s d i c t i o n t o determine a l l matters whether of law or f a c t . 5. As regards the attendance and examination of witnesses, the production and i n s p e c t i o n of documents, the enforcement of i t s orders, and other things connected with i t s j u r i s d i c t i o n , the Board has a l l the r i g h t s and p r i v i l e g e s of a superior court.  lu  I t may make orders or r e g u l a t i o n s concerning what i s t o be done or what i s p r o h i b i t e d under the Aot, and g e n e r a l l y f o r carrying the A c t into e f f e c t .  I t may r e c i n d or a l t e r these orders or  regulations as i t may t h i n k proper.  I t may provide p e n a l t i e s ,  when not provided i n the A c t , f o r i n f r a c t i o n of any of these orders or  regulations.  5. I t has j u r i s d i c t i o n as to the agreements entered i n t o between the company and another party concerning the p r o v i s i o n , c o n s t r u c t i o n , a l t e r a t i o n , maintenance, or use of the r a i l w a y or any p a r t of  i t s equipment.  v  6 . I t may, o f i t s own motion, or s h a l l , upon the request o f the M i n i s t e r o f Railways and Canals - (Transport)- i n q u i r e into and determine any matter upon which i t could act on complaint on a p p l i c a t i o n of some i n t e r e s t e d party.  I n the same way, the  Governor-in-Council may r e f e r t o the Board f o r a report concerning anything a r i s i n g i n connection w i t h the A c t . 7. I t may require the c o n s t r u c t i o n , p r o v i s i o n , or execution of such works as i t considers necessary and apportion the c o s t o f the establishment and maintenance of such works. 8. Of i t s own motion, or upon the a p p l i c a t i o n of any p a r t y , or a t the request of the Governor-in-Council, the Board may s t a t e a case i n w r i t i n g f o r the o p i n i o n o f the Supreme Court o f Canada upon any question of law or of j u r i s d i c t i o n of the Boards and the Supreme Court s h a l l determine the question and remit i t s opinion thereon t o the Board.  But the f i n d i n g s or determination  of the Board as t o matters of f a c t w i t h i n i t s j u r i s d i c t i o n are binding and conclusive. 9. Any r e g u l a t i o n , order, or d e c i s i o n of the Board, when published f o r three weeks i n the Canada Gazette, and while i t remains i n f o r c e , s h a l l have the same e f f e c t as i f embodied i n the Railway Act, and a l l courts are required t o take j u d i c i a l n o t i c e thereof.  V APPENDIX C. Personnel of Relevant Royal Commissions. 1. Royal Commission t o i n q u i r e i n t o Railways and Transportation i n Canada, 1917 Mr. A.H. Smith, New York, U.S.A. Chairman S i r H.L. Drayton, Ottawa, Canada. Mr. W.M. Acworth, London, England. 2 . Royal Commission t o inquire i n t o Railways and Transportation i n Canada, 1931-2 The The Sir Mr. Mr. Mr. Mr.  R t . Hon. Lord A s h f i e l d , London, England. R t . Hon. L.P. Duff, P.C. Ottawa, Canada, Chairman. J . W. F l a v e l l e , Bart., Toronto, Canada. B. Leman, C.E., Montreal, Canada. L.F. Loree, C.E. New York, U.S.A. W.C. Murray, L.L.D., Saskatoon, Canada. J.C. Webster, M.D., Shediac, Canada.  3. Royal Commission The The Mr. Mr. Mr. Mr.  o n  Dominion-Provincial R e l a t i o n s , 1937.  Hon. N.W, Rowell, L.L.D., Toronto, Ontario, Chairman. Hon. T. R i n f r e t , Ottawa, Canada, (resigned) J.W. Dafoe, L.L.D., Winnipeg, Canada. R.A. MacKay, Ph.D., H a l i f a x , Canada. H.F. Angus, M.A. B.C.L., Vancouver, Canada. J . S i r o i s , L.L.D., Quebec, Canada.  4. Royal Commission t o i n q u i r e i n t o National Transportation i n Canada, 1949. The Hon. W.F.A. Turgeon, K.C., L.D. Ottawa, Ontario, Chairman. Mr. H.F. Angus, M.A., B.C.L., Vancouver, Canada. Mr. H.A. Innis, M.A. Ph.D. L D., D.Ec.Sc., Toronto, Canada.  APPENDIX D. > Boundaries of "scales" of Maximum. Standard Mileage Rates as of  Class  19^9.  Maritimes Diamond, L e v i s , Megantic, Quebec and east thereof. Centrals  Diamond, L e v i s , Megantic, Quebec, and west thereof to and i n c l u d i n g Cochrane, Capreol, Sudbury, S a r n i a and Windsor, Ontario, and west thereof to Sudbury and S a u l t Ste. Marie, Ontario.  Superior: Cochrane, Capreol and Sudbury, Ontario and west thereof to Armstrong, Westfort and Porth Arthur, Ontario. Prairies  Port Arthur, Westfort and Armstrong, Ontario, and west thereof t o Edson and Canmore, A l b e r t a , and Crow's Nest, B r i t i s h Columbia. ^ 7  Pacifies  Edson, Canmore, A l b e r t a , and Crow's Nest, B r i t i s h Columbia and west thereof.  /  B r i t i s h Columbia Lakes D i s t r i c t also included i n P r a i r i e Scale.  APPENDIX E. H i s t o r y of Maximum Standard Mileage Class Rates by " s c a l e s " Maritime Scale. Class Rates i n cents per 100 pounds. 1 10 5  Date. 50 M i l e s  22  aune,1876 3 Dec, 1889 1 Mar, 1893 21 Apr. 1913 27 J u l y , 1915 1 Dec, 1921 10 May, 1923 1 J u l y , 1927 30 Mar, 19l|8  18 18  22 24  1+3  k3 3k k®  -  -  8 9 11 12 22 22 17 20.5  k.5 6  7 7 12.5 12.5 11 13  Notes,  1 2 3  k  5 6 7 8 9  400 M i l e s June, I876 3 Dec, 1889 1 March, 1898 1 A p r i l , 1913 27 J u l y , 1915 1 Nov, 1915 1 Dec, 1921 10 May, 1923 1 J u l y , 1927 30 March, 19I4S  76  kk kk  58 58 60  108  125.5 100 121  _  _  21 22 29 2  9  30  5k  15.5 15 20 20 20 36.5  63 50 60.5  41  27  1+1.5 3k  1 2 3  k 5  5 6 7 8 9  1000 M i l e s 1 March, 21 A p r i l , 27 J u l y , 1 Dec, 10 May, 1 July, 30 March,  1898 1913 1915  80  l+o  100 100  1927 I9I48  269.5 220 266  50 50 90. 135 110 133  1921 1923  180  Notes t o the Maritime 1. 2. 3. I4.. 5. 6.  36 36 65 95.5 76 96  3  k  5 6 7 8 9  Scale.  E a r l y four c l a s s rate F i r s t ten class rate Scale modified Scale increased Scale increased, 27 J l y , 1915, and 1 Nov, 1915. Following completion of h o r i z o n t a l increases and decreases i n a l l areas. 7. Scale made same as Central scale 8. Maritime Freight Rates Act 9. Scale increase. 30 percent Case u  Central  Scale Class Rates i n cents per 100 pounds  Date.  1  5  Notes,  10  50 M i l e s . June,  1 Jan,  24 (Summer) 28 (Winter)  1874  24 43 52  1884  1 Decbr, 1921 30 March,1948  12 22 26.5  7 12.5 15  2 3 4  400 M i l e s . 76 (Summer) 80 (Winter)  June, 1874  70 125.5 152  35 63 76  23 41.5 51  2 3 4  30 March, 1948  150 269.5 326  75 135 163  53 95.5 115.5  2 3 4  Notes to the Central  Scale.  1 Jan, 1 Dec,  1884 1921  30 March,1948 1000 M i l e s .  1 Jan, 1 Dec,  1884 1921  1. E a r l y four c l a s s r a t e s . 2. F i r s t t e n c l a s s r a t e s , using c l a s s 5 as base, 3. Following completion o f h o r i z o n t a l increases and decreases i n a l l areas. 4. Scale increased 30 percent. Case.  Class Rates i n cents per 100 pounds.  Date  1  4  Notes  10  50 M i l e s . 2 Nove, 1 May, 1 Dec, 50 Mar, 400 2 1 1 30  2 1 1 30  18  50 60  14 25 30  9 7 12.5 15  123 88 158 191  62 44 79 955  27.5  55  1921 1948  1886  1 2 3 4  Miles.  Nove, May, Dec, Mar,  1000  28  1885  1885  1886  1921 1948  1  24  2  52.5 51 91.5 111  1 2 3  43 52  3 4  Miles.  Nov, May, Dec, Mar,  1885  1886  1921 1948  228  160 287.5 348  114  80  144 174  4  Notes to Superior S a l e . e  1. F i r s t ten c l a s s r a t e s . 2. Scale modified 3. Following completion of h o r i z o n t a l increases and decreases i n a l l areas. 4. Scale increased. 30 pereent Case.  X  P r a i r i e Scale. Date.  Class Bates i n cents per 100 pounds. 1 4 10  50 M i l e s . 7 May, 1881 J u l y , 1885 15 Ap, 1835 1 June,1902 7 May, 1905 1 Sept,19"lU 1 Dec, 1925 50 Mar,1948  24 35 35 30 32 30' 45 54.5  12  18 18  15 17 15 23 27.5  -  Notes.  1 2 3 4  9  8 8 8  4a  12 14.5  5 6 7  400 M i l e s . J u l y , 1883 15 Apr,1885 1 June,1902 7 May, 1903 1 Sept,1914 1 Dec, 1921 30 Mar,194s  123 123 105 114 105 158 191  62 62 53 57 53  228 228  114 114 97 105 97 146 176.5  80  96.5  27.5 23 25 23 35 42  2 3 4  4a  5 6 7  1000 M i l e s . J u l y , 1833 15 Apr,1885 1 June,1902 7 May, 1903 1 Sept,1914 1 Dec, 1921 30 Mar,1948  194 211 194 291 352  _  52.5 45 48 45 68  82  3 4  2  4a  5  '6 7  Notes t o B a i r i e Scale. 1. E a r l y four c l a s s r a t e s (Schreiber) 2. T a r i f f "X" 3. F i r s t t e n c l a s s r a t e s , based on Schreiber and using c l a s s four as base. 4 . Manitoba Rates Agreement - Ontario and Manitoba. 4 j > . Manitoba Rates Agreement - Remainder of P r a i r i e Region. 5. Western Rates Case 6. Following completion of h o r i z o n t a l increases and decreases i n a l l areas. 7. Scale increased. 30 percent Case.  P a o i f i c Scale ( U n t i l 1 September, 1914, r a t e s applicable between s t a t i o n s i n t h i s region were provided f o r by p u b l i s h i n g i n f l a t e d distances and using f o r these distances the rates applicable i n the P r a i r i e Scale) Class Rates i n cents per 100 pounds  Date.  1  Notes  4  10  20 30 27 32.5  10 15 14 17  1 2 3 4  31 47 41 49.5  1 2 3 4  50 M i l e s . 1 Sept, 1 Dec, 1 Aug, 30 Mar,  1914  1921 1922 1948  38 57 53 64  UOO M i l e s . 1 Sept, 1914 1 Dec, 1921 1 Aug, 1922 30 Mar, 1948 1000  140 210 183 221  70 105 92 111  *  Miles.  1 Sept, 1 Dec, 1 Aug, 30 Mar,  1914  1921 1922 1948  242 363 327 396  121 182  164 197.5  59 87 78 94  Note8 on P a c i f i c Scale. 1. Western Rates Case 2. Following completion of h o r i z o n t a l increases and decreases i n a l l areas. 3. M o d i f i c a t i o n of Mountain D i f f e r e n t i a l 4. Scale increased. 30 peroent Case.  1 2 3 4  XI1  APPENDIX F. Percentage increase i n f r e i g h t rates since 1st September, 1914, i n various s c a l e s . Central  Date 1 Sept, 1 Dec, 5 Mar, 12 Aug, 13 Sept, 1 Jan, 1 Dec, 1 Aug, 30 Mar,  1914 1915 1918 1918 1920 1921 1921 1922 19^8  Percentage of Increase  Prairie 100 .100 115 125 169 162.5 150 150 181.5  100 105 121 15L5 212 204.5 189.5 189.5 229.5 129.5#  81.5#  Pacific  Notes.  100 100 110 125 169 162.5 150 132 159.5  1 2 3 4 5 6 7 8 9  59.5%  The above must be read i n conjunction w i t h Appendix E i n order t o get a true p i c t u r e . Notes. A u t h o r i t y. 1. Western Rates Case. B.R.C. General Order, 125 2 . Eastern Rates Case, B.R.C. General Order, 167 3 . 15% Case  B.R.C. General Order, 213  4 . 25% Case. Order i n C o u n c i l . P.C. I863 5. 40$ Case  B.R.C. General Order 308  6. Jan 1921 Reduction Case, B.R.C. General Order, 3 ° 8 7. Dec 1921 Reduction Case, B.R.C. General Order, 350. 8 . Aug 1922 Reduction Case. B.R.C. General Order, 366 9. 30$ Case  . B.R.C. General Order 70425  APPENDIX G. Summary of the Address Presented by Premier Johnson of B r i t i s h Columbia at the Hearing of the Board of Transport Commissioners i n Vancouver, November, 1948. 1.  15% Case.  Consolidation of B r i t i s h T e r r i t o r i e s i n North American was an I m p e r i a l , as w e l l as a N a t i o n a l p o l i c y .  Such p o l i c y having two  great objectives} f i r s t , the p r o v i s i o n of a r a i l w a y across the continent t o develop trade} second, f o r rapid t r a n s p o r t a t i o n of troops and war materials i n case of war. 2.  American expansion threatened to engulf the B r i t i s h t e r r i t o r i e s to the West of Canada unless they were bound t o Canada by the s e l f - i n t e r e s t s that would f o l l o w the l i n e s of trade and commerce.  3.  In order t o achieve Confederation the Imperial Government made the  Hudson's Bay Company lands l y i n g between the Great Lakes and  the  Rocky Mountains a v a i l a b l e to Canada f o r the purpose of  c o l o n i z a t i o n and upon the d i s t i n c t understanding that communication - by r a i l - would be e s t a b l i s h e d . 4.  B r i t i s h Columbia's entry i n t o Confederation was timed by the demand of Canada and the d i r e c t i o n of the Imperial Government.  5.  B r i t i s h Columbia asked f o r the immediate c o n s t r u c t i o n of a wagon road and was promised a r a i l r o a d instead.  6.  B r i t i s h Columbia's pact w i t h the Dominion was i n the nature of  and had the force and e f f e o t of a t r e a t y .  XIV  7»  The agreement of t h i s province f o r the construction of a r a i l r o a d was with the Dominion Government and not with the Canadiam P a c i f i c Railway Company,  8,  There was  no suggestion that any section of the Confederated  provinces would be charged higher  (freight) rates by reason  of higher costs of construction or maintenance and i t was presumed that any such additional costs would be borne by the Dominion as a whole* 9.  M i l i t a r y considerations, as w e l l as other objectives of a national or Imperial character, entered into' determination not by, B r i t i s h Columbia, but by Ottawa - to adopt the that necessitated the higher costs.  route  -  XV  AEPENDIX H. Trends of Transport Regulation i n the B r i t i s h Commonwealth. Great B r i t a i n . The Road and R a i l A c t of 1933 was passed t o promote co-ordination of these forms o f transport through attempted e q u a l i z a t i o n of operating conditions and t o a f f o r d p r o t e c t i o n t o the r a i l c a r r i e r s from the encroachment of highway transport s e r v i c e s . The Transport Act of 194-7 i s part of the Labour Government's programme of n a t i o n a l i z a t i o n .  I t e s t a b l i s h e d the  B r i t i s h Transport Commission as a p u b l i c a u t h o r i t y charged w i t h the general duty of providing or securing the p r o v i s i o n of an e f f i c i e n t , adequate, economical and properly integrated system of p u b l i c i n l a n d t r a n s p o r t a t i o n (other than transport by a i r ) and port f a c i l i t i e s . . . also....road  transport.  Australia. The problem of meeting competition between t r a n s p o r t services i n A u s t r a l i a has been undertaken by r e s t r i c t i v e r e g u l a t i o n i n favour of e x i s t i n g r a i l c a r r i e r s by each A u s t a l i a n State.  Several  unsuccessful attempts have been made by the Commonwealth Government to e s t a b l i s h a uniform programme which would place the t r a n s p o r t i n d u s t r y on a sound b a s i s .  A s i m i l a r co-operative e f f o r t by the  Commonwealth Government f o r the standardization of a l l r a i l w a y gauges i n the country has been under consideration f o r many years.  Railway  and t r a n s i t services throughout the Commonwealth are government-owned. Railway c o n t r o l i s vested i n commissioners who f u n c t i o n i n accordance with the regulations of the Railway A c t of each s t a t e .  There i s one  XVI commissioner each f o r the Commonwealth, Quennsland, New South Wales, South A u s t r a l i a , Western A u s t r a l i a and Tasmania, and three commissioners for V i c t o r i a . A i r Transport services are c o n t r o l l e d by the Commonwealth Government which requires a i r c r a f t to be l i c e n s e d . South A f r i c a . Co-ordination of transport i n the Union of South A f r i c a has been achieved by l e g i s l a t i v e process c a r r i e d out i n accordance wiJbh the i n t e n t of the South A f r i c a Act of 1909»  a n d  through measures designed by the Union Government t o r e s t r i c t and c o n t r o l , rather than p r o h i b i t , forms of transport that o f f e r uneconomic competit i o n to the State-owned and operated r a i l w a y s .  The establishment of  a M i n i s t r y of Transport, to include a l l forms of t r a n s p o r t a t i o n , has ' been discussed f o r some time. The Board of Transport consists of not more than three members appointed by/ the Governor-in-Council and the M i n i s t e r of S t a t e , who i s chairman. Control of motor-carrier competition was obtained by the Motor Transportation Acts of 1930  and  1932.  Commercial a i r t r a n s p o r t a t i o n has been brought under the e f f e c t i v e c o n t r o l of the Government r a i l w a y s . New Zealand. Considerable progress has been made by the Government i n developing a programme f o r the co-ordination of r a i l and highway t r a n s p o r t , the c o n t r o l l i n g of a l l forms of t r a n s p o r t a t i o n , and the c o n s o l i d a t i o n of the c o n t r o l and r e g u l a t i o n of t r a n s p o r t a t i o n under  one administrative  office.  Except f o r private oompanies operating coastal ships taxicabs, and delivery trucks, and the municipal  services, the  Government of New Zealand has control of a l l forms of transport, either through licensing or government operation.  XiX APPENDIX I (continued)  The r i g i d i t y o f grain f r e i g h t rates due  to  the overhead cost of the railway and to the statutory provisions of the Crow's Nest Pass Agreement mean that an Important factor i n the Western wheat farmers eosts remain r i g i d and therefore h i s net return i s succeptible to v i o l e n t fluctuations which i n cases of severe economic depression make f o r an almost i n t o l e r a b l e burden.  Perhaps soma f l e x i b i l i t y can  be introduced by government a c t i o n after t h i s nature: the statutory rates on grain could be made to fluctuate with the p r i c e of wheat but the railway's revenue would remain the same where the government-set rate below what the railways had been guaranteed by government subsidy equal t o the difference being paid to the railways.  There g r a i n rates were above the statu-  tory rate the government would recover the difference to o f f s e t the assistance given to the railways i n bad  years.  BIBLIOGRAPHY. 1. Angus, H.F. B r i t i s h Columbia and the United S t a t e s . T or onto,  I9I42.  Ryerson Press  2. Glazenbrooke, G.P. de T. A H i s t o r y of Transportation i n Canada. Ryerson Press, Toronto, 1938. lanna, D.B. Trains of R e c o l l e c t i o n . MacMillan, Toronto, 1924. 4 . Harri3, T.H. Economic Aspects of the Crow's NeBt Pass Rates Agreement. MacMillan, Toronto, 1930. 5. Henry, R.A.C. and associates. Railway F r e i g h t Rates i n Canada, a study prepared f o r the Royal Commission on Dominion-Provincial R e l a t i o n s , King's P r i n t e r , Ottawa, 1939. 6.  I n i s , H.A. Essays i n Transportation. U n i v e r s i t y of Toronto P r e s s , Toronto, 1941.  7.  I n n i s , H.A. A.History of the Canadian P a c i f i c Railway. P.S. King and Son L t d . , London, 1923.  n  8. I n n i s , H.A. Problems of Staple Production i n Canada. Ryerson Press Toronto, 1933. 9. 10.  I n n i s , M.Q. An Bconomio H i s t o r y of Canada. Ryerson P r e s s , Toronto, 1935. Jackman, W.T. Economic P r i n c i p l e s of Transportation, of Toronto P r e s s , Toronto, 1935.  University  11. L o c k l i n , D.P. Eoonomios of Transportation. U n i v e r s i t y of Chicago P r e s s , Chicago, 1938. 12. Leacock, S. Canada, p r i v a t e l y p r i n t e d by Gazette P r i n t i n g Montreal, 1941. 13.  Co.,  Lower, J.A. The Grand Trunk P a c i f i c Railway and B r i t i s h Colunfcia. Master's T h e s i s , U n i v e r s i t y of B r i t i s h Columbia, 1939.  14. MacGibbon, D.A. Railway Rates and the Canadian Railway Commission. Houghton-Mifflin, New York, 1917. 15. McLean, S.J. Inland T r a f f i c York, 1922.  Alexander Hamilton I n s t i t u t e , New  16. Marsh, D.A. The Tragedy of S i r Henry Thornton. MacMillan, Toronto, 1935: 17.  Skelton, O.D. The Railway B u i l d e r s . No. 32 of Chronicles of Canada s e r i e s , Glasgoe, Brook & Co., Toronto, 1916.  18. T a y l o r , 6.  Canada, Methuen, London, 1947*  19.  Thomson, L.R. The Canadian Railway Problem, MacMillan, Toronto,  20.  Canadiam Railway Cases. Canadian Law Book Company, Toronto.  1938.  Canadian Government P u b l i c a t i o n s . 21.  Annual Report, Department of Transport, K i n g s P r i n t e r , Ottawa, Various.  22.  Board of Transport Commissioners, Judgments, Orders, Regulations and Rules, F o r t n i g h t l y p u b l i c a t i o n . King's P r i n t e r , Various. E s p e c i a l l y V o l . XXXV111, A p r i l 5, 1948.  23.  Debates of the House of Commons, (Hansard) King's P r i n t e r , Ottawa. Various. E s p e c i a l l y 1903, 1917, 1932 and I94O.  24.  Report of the Royal Commission on Dominion-Provincial R e l a t i o n s , 1937» known as the R o w e l l - S i r o i s Report. King's P r i n t e r , Ottawa, 1939.  T  25. Report of the Royal Commission to i n q u i r e i n t o Railways and Transportation i n Canada, 1917, known as the Drayton-Acworth King's P r i n t e r , Ottawa, 1917.  Report,  26.  Report of the Royal Commission to i n q u i r e i n t o Railways and Transportation i n Canada, 1931-2, known as -the Duff Report, King's P r i n t e r , Ottawa, 1932.  27.  Statutory H i s t o r y of Steam and E l e c t r i c Railways i n Canada. King's p r i n t e r , Ottawa, 1937.  28. The Canada Gazette. King's P r i n t e r , Ottawa, v a r i o u s . 29.  1  The Canada Year Book, King's P r i n t e r , Ottawa, v a r i o u s . Unpublished Documents i n the L i b r a r y of the U n i v e r s i t y of B r i t i s h Columbia.  30.  Appeal re Railway Rates, Ottawa, Sept,  1920.  31. P e t i t i o n of -the Attorneys General of the Provinces of B r i t i s h Columbia and A l b e r t a by way of an appeal of an order of the Board of Railway Commissioners f o r Canada, June, 1922, p r o v i d i n g f o r a change i n Railway T o l l s . 32. Appeal of B r i t i s h Columbia and A l b e r t a re Railway Rates, 33.  1923.  Statements f i l e d by Council f o r the Province of Saskatchewan on appeal f o r r e v i s i o n of r a t e s , January, 1924.  3hm Hearing re Crow's Nest Pass Agreement R a t e s , December, 1921+ 35. Subnus s i o n of the Attorney General of the Province of B r i t i s h Columbia re Grain Rates t o P a c i f i c Coast P o i n t s . August, 1925. 36. General Submissions of the Attorney General of B r i t i s h Columbia, August, 1925. 37. Data of the Canadian National Railways requested by the Province of B r i t i s h Columbia i n connection w i t h a General F r e i g h t Rates I n v e s t i g a t i o n , 1925. 38. General F r e i g h t Rates Case.  Various E x h i b i t s , June, 1926.  39. Operating Revenues and Average Haul on C e r t a i n Commodities, Canadian P a c i f i c Railway S t a t i s t i c s , 1926. I4.O. Operating Expenses.  Canadian P a c i f io Railway S t a t i s t i c s ,  1926.  1+1. I l l u s t r a t i o n s of Transportation Movements of G r a i n , Lumber, Sugar Canned Goods, e t c . Canadian P a c i f i c Railway S t a t i s t i c s , 1926. i|2. General Rates I n v e s t i g a t i o n . t o . 1926.  L i s t of Documents f i l e d or r e f e r r e d  Il3» Memorandum re the Transportation Problems and Freight Rates Structure of the Province of Nova S c o t i a , 1926. kk» Memorandum Covering G r a i n Rate S i t u a t i o n as i t stands at March 31, 1926. 1 4 5 . Statement of Revenues and Expenditures (and C e r t a i n S t a t i s t i c s ) re Eastern Lines as defined i n the Maritime Freight Rates A c t , 1927, f o r the s i x months ending December 3 1 , 1927. 146. Hearing of Appeal by way of P e t i t i o n of the United Farmers of B r i t i s h Columbia e t a l and of the Governments of B r i t i s h Columbia A l b e r t a and Sakatchewan and tiie Shipping Federation of B r i t i s h Columbia r e F r e i g h t Rates, Ottawa, October, 1929. 1+7 • Appeal by way of P e t i t i o n - the UnitedFarmers of B r i t i s h Columbia et a l v i s the Canadian P a o i f i c Railway Company and the Canadian N a t i o n a l Railways, January, 1929. 1+8. B r i t i s h Columbia's Freight Rate Discriminations F r e i g h t Rates i n Canada compared w i t h Freight Rates i n the United States: Cost of Constructions Cost of Operations Table showing Meeting Point of Ratess Canadian G r a i n and i t s Cost of Transportation t o Tidewater and World Markets. . McGeer Papers.  

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