Canadian soldiers travelling west to put down the North West Rebellion, 1885

True to form, the Hudson's Bay Company reacted to the battle by trying to exploit its profit potential. Immediately after the Duck Lake ma.s.sacre, the Company ostentatiously placed itself at the disposal of the Dominion authorities and a.s.sured Minister of Militia and Defence Adolphe Caron that it would provision his forces in the battle area. Trade Com- missioner Joseph Wrigley set the tone of the HBCs patriotic contribution when he sent an urgent letter to Chief Factor Archibald McDonald at Fort Qu'Appelle, the field force's main jumping-off point. "All supplies furnished by you to the Military Expedition," he ordered, "must be charged at wholesale prices ... get receipts!" By the end of hostilities, the Company submitted bills for $2 million, which included a $96,000 profit. The HBC then claimed a further $207,115.84 for damaged buildings and stolen furs but collected only $163,768.54.

In grat.i.tude to the nascent railway for transporting the troops west, Parliament voted to authorize the guarantee 168 LABRADOR SMITH.

of a temporary $500,000 loan. It wasn't much, but it was enough to save the line. An impatient creditor was about to push the companyinto receivership. When Van Horne and a group of CPR executives got the news, they went wild. "We tossed up chairs to the ceiling; we tramped on desks; I believe we danced on tables. I do not fancy that any of us knows what occurred, and no one who was there can ever remember anything except loud yells of joy and the sound of things breaking." Soon afterwards Parliament guaranteed most of a final $35-million issue of mortgage bonds,* and Stephen hurried over to London where Lord Revelstoke, head of Barings, the famous merchant banking firm, purchased the balance.

Because Smith was forced by political circ.u.mstances to stay under cover during much of the CPR's construction, it was Stephen and Van Horne who got most of the public credit for the projects completion. But a few years later before a London audience, Sir Charles Tupper, who as Alacdonald's ministcr of finance had been in the centre of the bargaining, declared that "the Canadian Pacific Railway would have no existence to-day, notwithstanding all that the Government did to support that undertaking, had It not been for the indomitable pluck and energy and determination, both financially and in every other respect, of Sir Donald Smith."

CHOSEN TO FIAUMER IN THE CPR'S LAST SPIKE, Smith had travelled west aboard his private railway, car, Matapedia, as part of a small train that included Van Horne's Saskiih-bewan, a baggage car and the engine, As

*At this crucial moment, Smith reportedly presented Lady Macdonald with a necklace worth $200,000 to influence her husband to grant the new loan.

Stephen later confirmed the "bonification" but stoutly maintained it was "a personal gift."

STEAL OF EMPIRE 169.

they puffed across the country, crews were racing to lay the final links through Kicking Horse Pa.s.s. The rails from east and west were due to abut at Eagle Pa.s.s, a forlorn spot in the Monashee Mountains that Van Horne had named Craigellachie, after the clan stronghold of Smith's and Stephen's ancestors in Moray.

In the United States, comparable last-spike ceremonies had inevitably included fireworks, marching bands, extravagant speechifying, free liquor for construction crews and gold-plated spikes. At the last-spike ceremony of the first transcontinental U.S. railway at Promontory, Utah, two gold and two silver spikes had been driven into polished laurel cross-ties.

Telegraph offices along the line were manned, their specially wired keys left open so that an account of the hammer blows could be heard across the country. In contrast, the Craigellachie celebration was to be a very Canadian occasion with no pomp and little ceremony. A discarded boxcar had been set aside to serve as a temporary railway station. From the Pacific side arrived a mixed work train, and a small party of labourers gathered to watch the final spike being driven home. Lord Lansdowne, then Governor General, had commissioned a silver spike for the occasion, but Van Horne was his usual practical self. "The last spike," he decreed, "will be just as good an iron one as there is between Montreal and Vancouver, and anyone who wants to see it driven will have to pay full fare."

On the misty morning of November 7, 1885, Major A.B. Rogers, who had found the pa.s.s for the railway through the Selkirk Mountains, held the tie bar under the final rail in place for the ceremonial finish. Smith's first feeble blow merely turned the designated spike's head, bending it.

Roadmaster Frank Brothers yanked it out, replaced it with a new one, and Smith carefully tapped it home. Alexander Ross, the hunchback 170 LABRADOR SMITH.

photographer from Winnipeg, took his famous shots, but except for a thin cheer there was little rejoicing. The only sound that reverberated in that historic canyon was the thump of Smiths niaul. For a long moment there was silence, as if thosc present were remembering all the an-u1sh that had led to this moment. "It seemed," recalled Sir Sandford Fleming, the CPR director who had first suggested the practicability of a transcontinental railway twenty-five years earlier, "as if the act now performed had worked a spell on all present. Each one appeared absorbed in his own reflections."

Smith said nothing. Van Horne gruffly allowed that "the work has been done well in every way." But it was the conductor of the little train, now cleared to head due west, who p.r.o.nounc(!d the ceremony's most dramatic line when he shouted. "All aboard for the Pacific!"

It was a moment that changed Canadian history. Louis Riel, whose two rebellions had unintentionally

*The engine that pulled the train west was sc.r.a.pped and the Alatapedia burned on her trucks at Princeton, B.C., in 1925, but Van Horne's private (at has been preserved by the Canadian Railroad Historical a.s.sociation. The maul used by Smith to pound in the last spike was last seen in the bas.e.m.e.nt of his Montreal house being used to break up coal lumps for the furnace.

There is considei able controversv about the fate of the last spike, but in a letter to the author datedAlarch 10, 1989, the present Lord Strathcona explained what happened: "The last spike was an ordinary nail and is still in place. The 'one-from -last' spike was bent and pulled out. Small pieces were cut out and incorporated into spike-shaped diamond brooches for Ladv Strathcona, Lady Shaughnessy, and the wife of the GovernorGeneral. In the Shaughnessy one, an emerald has been put in place of iron. We still have a slightly larger brooch with iron disc. The 'one-from-last' spike, with pieces cut out, was presented bv me to the CPR at a centenary ceremony on condition it was put on display. It is on permanent loan to the Transport Museum in Ottawa, probably still sitting on a teak block made by me."

STEAL OF EMPIRE 171.

Donald Smith hammers in the last spike, November 7, 1885

opened up the West, was hanged for high treason in Regina nine days later, clearing the way for prairie settlement. The closed world so jealously guarded by the Hudson's Bay Company for two centuries was now irrevocably breached. The spider's web of waterways and

Craigellachie itself never prospered and was all but abandoned after the Second World War. Its tiny train station was closed, though location of the last-spike ceremony was landscaped for a 1985 centennial re-enactment. The CPR did not bother to maintain the site, and in January of 1990, the railway company withheld permission for the final run of its last transcontinental pa.s.senger train to pull in at Craigellachie. Told they couldn't stop, the crew decided to throw a wreath off the train at the appropriate spot. But when the engineer slowed down, he forgot to notify the rest of the crew, and nothing happened. "They didn't tell us they were going to let us throw it off," explained a befuddled employee. If Paris was worth a ma.s.s, Craigellachie was worth a stop--but no one at the CPR cared.

172 LABRADOR SMITH.

prairie trails, worn out of the wilderness by decades of Red River carts hauling goods from Fort Garry to Edmonton, from Qu'Appelle to Battleford, and on westward to Red Deer Forks and all the way to Peace River Junction, had been rendered obsolete in a day. The great HBC installations at Fort Carlton and Fort Pitt shrank to inconsequence.

By throwing most of his energies into financing the CPR instead of enlisting the 11B(A London board to sponsor or at least propose a joint venture for the rail way through its former territory, Smith threw away the Company's future as a major plaver in the evolution of Canada's modern economy. "ihe Canadian Pacific Railway," Michael Blliss pointed out in his Northern Enterprise, "was created by westerners and fur traders.

But not by the Hudson's Bay Company. The fur-trading concern was not able to maintain the monopoly it gained in 1821 or use its advantages to diversl~- into new lines.

... New men, some of whom began as pipsqueak fur traders challenging the mighty Company, became the key to the Canadian Pacific-in alliance with one of the HBC , s own former Factors. The former fur traders orga nized the CPR syndicate and built the road after central Canadian capitalists had bungled the job and given up.

They succeeded without the help of the Hudson's Bay Company, and by their success they put it permanently in the CPR's shadow."

The first scheduled transcontinental left Montreal for Port Moody on June 28, 1886. Its engine was draped with flowing silk ribbons as the Pacilic Express pulled out of Dalhousie Square Station to cheers and a fifteengun salute. It completed the 2,907-mile journey in 139 hours, just over five and a halfdays. Once it became fully operational, the CPR phigged Canada into world trade. The Silks-non-stop express trains hurtling eastward from Vancouver~provided a link for consignments of STEAL OF EMPIRE 173.

Oriental textiles dispatched from Hong Kong and Siam to Montreal and on to London. The dream of a North West Pa.s.sage had been achieved at last-even if it was a century late and over land instead of water.

AN EXHAUSTED GEORGE STEPHEN retired to England and turned the CPIR over to Van Horne, who transformed it into an integrated transportation system, building grain elevators, hotels and steamships, as well as infusing the railway with the same gusto that had allowed him to build it in the first place. He later threw railways across Cuba and Guatemala but his first loyalty was to the CPR. "Building that railroad," he said on the day he renounced his American citizenship, "would have made a Canadian out of the German Emperor."

On the way back from the last-spike ceremony, Van Horne had sprung a surprise on Smith. Without the elder man's knowledge, a spur line had been built from

*One of Van Home's favourite ploys was to test future employees with his cigar trick. When a firm of cut-rate tobacconists had capitalized on his fame by calling a five-cent brand the "Van Horne," he ordered several boxes of the leafy horrors, removed their bands, and mixed them with expensive perfectos in his humidor. Prospective employees, wishing to acknowledge his reputation as a connoisseur, would inhale the tarry mixture, then ecstatically compliment him on the "delightful aroma." They could only smile icily at Van Horne's crude guffaw that followed his explanation. f le once hired a man mainly because he had b.u.t.ted one of the dud cigars after his first whiff and demanded: "How much does the stable boy charge you for these things?" During Van Home's final illness, his doctors limited him to three cigars a day. He meekly agreed. But by next morning he had a box of specially rolled two-foot-long perfectos brought to his bedside, and so puffed contentedly the prescribed three a day, four hours each, until he died on September 11, 1915.

174 LABRADOR SMITH.

Winnipeg to his country house at Silver Heights. Smith and his party of railway executives were so busy talking no one paid any attention when the engine was being driven in reverse until they were almost pulling up to his house. "Now, there's a very neat place," Smith remarked, looking increasingly puzzled. ". . . who is it that has Aberdeen cattle like that?

I thought I was the only one. This is really very strange ... I must be going crazy; I've lived here many yean, and I've never noticed another place so exactly like Silver Heights." The mystery was explained when the conductor called the stop: "Silver Heights!" For once, Smith was overwhelmed. Proud of his homestead, he had i-aised a small herd of buffalo there and entertained four governors general. Smith could never do enough for his visitors. When the Marquess of Lorne, the Queen's son-in-law then Canada's Governor General, came to visit, the faqades of Silver Heights'

main buildings were transformed into a copy of Inveraray Castle, the viceroy's ancestral home.

Success of the railAay had converted the trio of capitalist desperados who had built and financed it into high- Establishment figures. Queen Victoria honoured Stephen with a baronetcy while Smith and Van Horne were dubbed Knight Commanders of the Order of St Michael and St George. By 1887, Smith was named the Bank of Montreal's president, having become one of its dominant shareholders, second only to Sir William C. Macdonald.* Smith ran for Parliament as a Sir John A. Macdonald supporter In the 1887 election and sat as a largely quiescent MP for the next nine years. During that period, he took some time out to savour his accomplishments and become a significant philanthropist. He donated at least $2.5 million to McGill University, of

*Alacdonald was a Prince Edward Islander who had arria.s.sed a fortune selling tobacco (luring the American Civil War.

STEAL OF EMPIRE 175.

which he became the chancellor, directing that some of the funds be used to provide I-or the admission of women.* Together with Stephen, he financed the building of the Royal Victoria Hospital in Montreal and donated two ships to Dr Wilfred Grenfell's mission in Labrador.

To display his wealth and influence properly, Smith built a mansion on two properties at the corner of Fort and Dorchester streets. The exterior was brownstone, brought from the Ontario Credit Valley, and the front door opened onto a magnificent three-storey, $50,000 mahogany staircase, carved by artisans who dovetailed all the parts so that not a single nail was used in its construction.The second-floor ballroom was overlooked by a marble balcony to accommodate the musicians. Smith understood little about painting, but his private collection included work~ by Raphael, t.i.tian, Gainsborough, Revnolds, Romney, Constable and Millais. The diningroom opened into a garden for summer receptions attended by more than two thousand neck-craners.

Below stairs and out of hearing was a row of eight rooms for more than a dozen maids and flunkeys, including an English butler, inevitably nained James. Fitted more by temperament than by birth for the aris-ocratic life, Smith ruled his household with huniourless mastery.

Once, while he was eating breakfast with Dr Grenfell, ~e watched the lamp under the hot-water kettle falter and die. When the missionary wanted to relight it, Smith stopped him and angrily summoned the butler. "Remember, James," he said, "vou have onlv certain duties to perform. This is one.

Never, under anv circ.u.mstances, let such an omission occur again."

*In his honour, McGill's first eight fernale graduates, who received their Badielor of Arts degrees in 1888, called theinselves the "Donaldas."

176 LABRADOR SMITH.

Smith was a sn.o.b to the point of keeping a private guest tally categorizing his visitors according to their social rank. The impr,_~ssive roll call includeda futureking and queen of England, a prince and princess, eight dukes, seven marquises, twenty-one earls, six viscounts, six governors general, seven prime ministers, twentv-seven provincial premiers, four archbishops, seventeen bishops, fourteen chief justices, twenty- nine supreme court judges, thirt.y-one imiyors and fif~-eight generals. The tally even separated this last group into forty-seven generals of the Imperial Army and eleven commanders of colonial troops. The future king and queen were George V and Queen Vary, who came to -Montreal as the Duke and d.u.c.h.ess of Cornwall and York. On that occasion, Smith not only refurnished their rooms but had a special balcony built off the second floor so that the royal Couple might have a better view of the fireworks display lighting up the top ofA Iount RoN al in their honour.*

Through Smith's involvement A ith the building of the CPR he had become a significant figure on the world's financial stage, and in his corporate dealings he now reverted to concentraiing his wiles ond energies on the Hudson's Bay, Company. Within three years of the lastspike ceremony he would become the Company's Deputy Governor and, less than twelve months later, its Governor.

*According to Freeman Clowery, the former archivist at the Bank of Montreal, Lady Strithcona presented the d.u.c.h.ess with a spray of maple leaves fashioned of gold, diamonds and pearls that had been made by Henry Birks & Sons for $1,600.

CHAPTER 7.

CANADA IN A.

SWALLOW-TAIL.

coAT

Becoming a peer of the realm was no tri ling matter. So Smith did what be always did on such uwtersbed occasions. He remarried Isabella. The secret ceremouy ... reunited the bride and groom (thin sevenq-seven) fir tbefourtb andfinal time.

DURING THE TROUBLED WIN'l ER of 1895-96, there were whispers that Donald Smith would become Canada's sixth Prime Minister. Mackenzie Bowell, the fusty Ontario Oringeman who occupied the nation's top political office at the tirne, governed with a degree of incompetence that decisively distinguished him among the uneven quartet who succeeded Sir John A.

Macdonald. In his humbling way of dealing with nearly every issue threatening the still fragile Dominion, Bowell demonstrated an unerring instinct for his own jug-Lilar. His inability to manage the ordinary business of government, much less such politically ch~arged issues as the Manitoba Schools Question, prompted seven ministers, half his cabinet, to walk out and demand a new leader.

1170.

180 LABRADOR SMITH.

Smith, " ho had by then been the loyalTory member for Montreal West for most of a decade, was immediately nominated for the job. "There is one man, and one man alone," declared Sam Hughes, MP for the Ontario riding of Victoria North, "who can save the LiberalConservative Party from falling to pieces, and also who can command the respect and confidence of the whole country, and that is Sir Donald A. Smith." The cry was taken up by others, but the Hudson's Bay Company Governor, ever faithful to his creed of self-advancenicrit, saw no point in tying his future to the leadership of a party that had the smell of a dying political movement.

Still, he used the occ.ision to help nianoeuvre circurnstances that would h.e.l.l) him realize what was, to his way of imperialistic thinking, a more attractive alternative: appointment as Cana,la.s High Cot n rniss loner to the Court of StJames's.

Since that office m as held by Macdonald's veteran lieutenant, Sit- Charles Tupper, Smith made a great show of eschewing pcrsonal ambition and with mock modesty helped lever the holder out of the post he wanted to occupy. "I have no claim Ito the prime ministership]," he humbly insisted, "while such a statesman as Sir Charles Tupper is alive and active, and prepared to a.s.sume the burden should the latter prove too great for Sir Mackenzie BoAell." Tupper rushed back to face the thankless task of leading his part~ into its disastrous electoral confrontation with Wilfrid Laurier. When Smith began to lobby him hard for the London Job, the new Prime Minister, delighted at the prospect of having an ocean between himself and his one-time nemesis, undertook to appoint the HBC Governor High Commissioner, though the neophyte diplomat was seventy-six years old.

True to form, Smith followed his standard procedure whenever faced by an.

important career move: he CANADA IN A SWALLOW-TAIL COAT 181.

remarried Isabella. Using the excitse that he had mislaid his marriage certificate, on March 9, 1896, he and his wife went through their third wedding ceremony in the Wall Street office of John Stirling, Smith's New York lawyer. Staged to put an end to whispers about the couple's murky marital past, this masquerade Onlv drew attention to Smith's relentless sense of Presl~yterian guilt. Tupper served only ten weeks in office before being beaten by Laurier, but on April 24, 1896, he appointed Smith to London and in a touching move also named him a Privy Councillor, the t.i.tle Smith had coveted when the two men had ridden together to Red River twenty-six ycars earlier.

The British posting was Canada's most important (indeed, only) diplomatic appointment, but its occupant was under few legal, partisan or economic constraints. Sir Alexander Tilloch G~alt, the railway promoter who became Macdonald's finance minister and later served as Canada's first High Commissioner, used the prestige of the office to help finance exploitation of the coalfields his son had discovered on the Belly and Little Bow rivers near Lethbridge in southern Alberta. Tupper himself held the posting while still a member of ,'vlacdonald's cabinet and regularly returned home to fight election campaigns.*

*The post has gont ever since mainly to superannuated politicians. During the Second World War it was occupied bV former Liberal organizer Vincent Ma.s.sey, who later became Canada's first native-born Governor General. AXhile in London Ma.s.sey vividly recalled receiving a letter from a worried British housewife with a unique complaint. "A Canadian soldier on leave has visited my house," ~he wrote. "As a result both my daughter and I are pregnant. Not that we hold that against your soldier, but the last time he w;,s here he took my daughter's bicycle which she needs to go to work."

182 LABRADOR SMITH.

Although he served as his country's ranking representative in the glittering capital of history's greatest Empire, the High Commissioner devoted most of his time and energy to more mundane pursuits, acting as Canada's main immigration recruiter, chief financial facilitator and manager of the national debt. London was the centre of world trade and finance, while Canada's money markets were still too primitive and much too modest to capital -ize the new Dominion's rapid expansion.

The 1896 election sp.a.w.ned a new age in Canada. The once vital era of Macdonald, which had sputtered to a dreary conclusion after the death of its guiding spirit, was replaced by the tantalizingly optimistic "min- istry of all the talents" headed by Wilfrid Laurier, the forceful yet pragmatic nationalist who was to govern Canada for the next fifteen years. Suddenly, everything seemed possible. The new Prime Minister personified the young nation's hopes with his a.s.sertion that the twentieth century belonged to Canada.* Laurier didn't agree with Tupper on very much, but it didn't take the Liberal Prime Minister long to decide that Smith, who had spent most of two decades subverting the Liberal cause, was far less dangerous in London than back in Canada. The Hudsons Bay Governor, who also retained his presidencies of the Bank of Montreal and Royal Trust and his seat on the executive committee of the CPR, was quickly reappointed by the new government.