PROCEEDINGS OF THE CANADIAN INSTITUTE. I2g 



the public interest determine the distribution of the public money. We are fond of 

 saying that railways should be undertaken purely as conimercial enterprises; but 

 with an empire to colonize, vast spaces to open in the west and enormous natural 

 obstacles to overcome, and settlement scattered over wide leagues of prairie, it is 

 doubtful if any practical government could conclude that liberal aid to pioneer 

 roads or the construction of pioneer roads by the State was not a wise and legiti- 

 mate feature of any well-considered plan of colonization. Theory counts for a good 

 deal more in print than in government. We owe something to remote and strug- 

 gling settlements, and if we proceed wisely we reap a return in growth of markets, 

 expansion of trade and increase of revenue. It does seem clear^ however, that we 

 should vote no more public money to our great through systems, and that, richly 

 and prodigally endowed as they have been out of the public treasury, they should 

 now construct their own branches, and even as in the case of street railways, where 

 they enjoy a monopoly in any rich territory, they should be required by Parlia- 

 ment to push out new branches as increase and extension of settlement demand. 



XIII. 



It seems for the moment to be the policy of Parliament to reserve running 

 rights over new roads for possible competitors. It may be that this policy involves 

 the continuation of the system of subsidies. In cases where heavy public subsidies 

 are voted to aid in the construction of railways that become the property of pri- 

 vate companies, it is perhaps not unreasonable that the State should reserve the 

 right to give future competitors the privilege of running over rails that have been 

 laid with public money. But in the case of roads that are built wholly by private 

 capital, it would seem to be an extreme exercise of the public authority to give 

 competitors, seeking to share in a business they had done nothing to create, the 

 right to use the roadbed and station accommodation of the pioneer corporations. 

 This policy was tried in England, but was found to operate as a very serious check 

 to railway building, and was abandoned as unprofitable and impracticable. Perhaps 

 all that can be said on the point is that it is a policy that can be applied to existing 

 railways only by mutual agreement, and to such railways hereafter to be con- 

 structed as may receive large grants of public money. It was well in the case of the 

 Crow's Nest Railway, where a mountain pass was to be held for the people, that 

 this right of running powers should be clearly and unequivocally reserved, and it 

 is fair to point out that a subsidy granted with this material reservation is some- 

 thing very different from a grant of aid without conditions. It is, in fact almost 

 equivalent to public ownership, and will give a roadbed through the mountains 

 to any railway, private or national, that may hereafter be constructed across the 

 western prairies into British Columbia. Perhaps a more practicable policy would 

 be to acquire the right of way and build the roadbed of new railways with the money 

 of the State and lease the rails to private corporations. This would be to stop mid- 

 way between public ownership and operation and would make the final stage easy, 

 and as it is not at all difficult to fix the carload rate per mile for freight business, 

 public regulation of charges under such conditions could be made very efifective. 

 It seems to me it would be well to consider this policy in developing a railway sys- 

 tem in northern Ontario, where as yet the claims and franchises of private corpora- 

 tions have only a slight foothold, if we are not ready to accept the more heroic 

 policy of public construction and operation. 



XIV. 



One hardly finds it necessary to prove the waste of competition, the fact of 

 combination, the existence of discriminations in Canada. There is for the time a 

 war of passenger rates between the two great Canadian railways, but this will be 



