[shortt] CONSTRUCTION AND NATIONAL PROSPERITY 297 



proving to be illfounded, an optimistic reaction set in, supported by 

 good prices for Canadian produce and encouraging symptoms of com- 

 mercial prosperity. 



At this stage attention was directed to the fact that although the 

 construction of canals and a general improvement of Canadian water 

 had furnished an excellent means of transport for both Canadian and 

 American produce during the summer months, yet traffic was practi- 

 cally suspended during the winter, while in the adjoining states it was 

 maintained throughout the year by means of their railroads which 

 had been steadily advancing for over a decade past. 



Mainly through the enterprising activity of Mr. (afterwards, Sir) 

 Francis Hincks, Canadian Minister of Finance, the first Canadian rail- 

 road policy was worked out. The object of this was to supply Canada 

 with an adequate railway system, connected, on the one hand, with 

 the Western American lines, and, on the other, furnishing a continuous 

 connection with Atlantic ports open to navigation throughout the 

 year. This first provincial policy was introduced through the medium 

 of the Act of 1849, which contemplated assistance from the British 

 Government for the frequently discussed project of an Intercolonial 

 Railway, linking Canada with the Maritime Provinces, and furnishing 

 through them communication with the Mother Country, over British 

 territory, at all times in the year. 



Previous to 1847 there was in Canada but one short railway line 

 ,of fifteen miles, connecting La Prairie, opposite Montreal, with St. 

 John on the Richelieu, and being part of the main highway between 

 Montreal and New York. Before 1849 three other lines had been 

 started, on the basis of purely private enterprise. But, prior to the 

 introduction of the general government policy, there were less than 

 fifty miles of completed railroad in the country. 



The title of the Government measure of 1849 sufficiently indi- 

 cates the nature of the new policy. Its object was "To provide for 

 affording the guarantee of the province to the bonds of railway 

 companies on certain conditions, and for rendering assistance in the 

 construction of the Halifax and Quebec Railway." The government 

 assistance indicated was a guarantee, at six per cent, of the bonds of 

 railway companies, to the extent of one-half the cost of construction, 

 for lines of seventy-five miles and upwards. Owing to difficulties and 

 misunderstandings as between the British North American Provinces 

 and with the Home Government, the second or interprovincial part 

 of the Canadian policy was not realized until after Confederation. 

 The optimism of the country with reference to the new railway projects 

 which immediately sprang into existence to take advantage of the 

 government assistance, was strikingly manifested in the faith of both 



