[shortt] CONSTRUCTION AND NATIONAL PROSPERITY 305 



enterprise through the expenditure of a million and a half in the city 

 itself, the influx of rural and immigrant population and the consequent 

 demand for houses, stores and other structures, there was developed 

 a vigorous movement in land speculation. Not only did lots in the 

 city itself rapidly change Tiands, rising in price at every transfer, but 

 the adjoining farms were seized upon and subdivided, the lots being 

 rapidly disposed of. As land values continued to soar, the assessment 

 roll expanded in volume and values. This meant incresing revenue 

 and the ability to borrow more capital in the British market. In the 

 meantime, as the Mayor afterwards confessed, the interest on previous 

 borrowings was punctually paid out of the proceeds of the latest loans. 

 When, however, the crisis of 1857-8 brought the boom to an end, re- 

 vealing the fact that the prospective returns from the railroads would 

 have to be deferred at least for some time, many peolpe were thrown 

 out of employment and left the city. With the city shorn of its out- 

 lying subdivisions, its population sinking and values falling, the civic 

 fathers found themselves in a very difficult position. If they levied 

 sufficient taxes to meet their engagements they would further depress 

 values and drive more people out of the city. On the other hand, if 

 they did not levy sufficient taxes they could not pay the interest and 

 sinking fund charges on their bonds. The Mayor claimed that they 

 would have to raise 50 cents on the dollar of their reduced assessment 

 in order to meet their obligations. As between the pressure at home 

 and the pressure abroad, the civic authorities decided that the bond 

 holders in England might wait, and this decision was conveyed to 

 them in a circular from the Mayor. Naturally enough, this resulted 

 in much indignation upon the part of the English capitalists. They 

 vigorously protested, and finally took legal action, which was met, 

 however, by passive resistance on the part of Hamilton. These and 

 similar proceedings on the part of Canadian municipalities, joined 

 to the other financial collapses, had very serious effects upon Canadian 

 credit. The financial editor of the London Times thus voiced British 

 sentiment, "If an honourable settlement is much longer delayed it is 

 hoped that the authorities of Canada, whether general or local, have 

 seen the last shilling they are likely for some years to come to receive 

 from the credulity of our investing public." Eventually the Govern- 

 ment had to come to the rescue of a score of bankrupt municipalities, 

 though much to the detriment of its own credit. 



As a sample of the booming of many new towns on lines of railway, 

 constructed for the development of the northern country, we may take 

 the case of Bell Ewart, a new civic proposition on the Northern Rail- 

 road at the southwestern end of Lake Simcoe. It was started in 1854 

 by an enterprising gentleman from Dundas, after whom the town was 



