Fleets, naval stations, coaling stations, dry docks, whole cities supported by shipyards are bound to grow on the Pacific just as surely as the years come and go. The growth has begun already. Nothing worth having can be left undefended and be kept. Poor old China tried that.

So did Korea. We may talk ourselves black in the face over peace and pa.s.s up enough plat.i.tudes to pave the way to a universal brotherhood of heaven on earth, but in the past good intentions and plat.i.tudes have paved the way to an altogether different sort of place. In the whole world history of the past (however much we might wish this earth a different place) the nation most secure against war has been the nation most prepared against war. Canada can't dodge that fact. With Panama open come the armaments of the world to the Pacific!

How about a merchant marine for Canada? This question was important to the maritime provinces, but the maritime provinces are well served by British liners. On the Pacific seventy-two per cent. of the carrying trade is already controlled by j.a.pan. Now Canada can buy her ships in the cheapest market, Norway or England.

She can herself build ships as cheaply as any country in the world.

She can operate her ships as cheaply as any country in the world.

She has no restrictions as to the manning of her crews and, as far as I know, has never had a case of abuse arising from this freedom which her laws permit.

Except for the St. Lawrence after October, there is no foreign discrimination in the insurance of her ships.

Canada can go into the race for world-carrying trade unhampered.

She has yet another advantage. With only two or three exceptions--a fishing bounty, one or two mail contracts--the United States has not given and may never give government aid to ships. The Canadian government does and does wisely! Ocean traffic may be as requisite to prosperity as rail traffic, and you can't give land subsidies to the sea.

III

It is when one comes to consider Panama's influence on rail traffic that it becomes apparent the Ca.n.a.l may divert half the Dominion's traffic to seaboard by Pacific routes. Why do you suppose that the big grain companies of the Northwest want to reverse their former policy?

Formerly the biggest elevators were built east, the medium-sized at the big gathering centers, the smaller scattered out along the line anywhere convenient to the grower. To-day, as far as Alberta is concerned, the biggest elevators are going up farthest west. Why? Why do you suppose that the big traction companies of Birmingham, Alabama, the big wire companies of Cleveland and Pittsburgh are looking over the Canadian West for sites? One Birmingham firm has just bought the site for a big plant in Calgary. Why do you suppose that the Canadian Pacific Railway is building big repair shops at Coquitlam, and the Canada Northern at Port Mann? Why are both these roads also stationing big repair plants at inland points, one at Calgary, the other supposed to be for Kamloops? It is not to help along the townsite lot booms in these places. No one deprecates these town lots running out the area of Chicago more than the railroads do. "Wild oats" hurt trade more than they advertise the legitimate opportunities of a new country.

Take a look at them!

From Fort William to Alberta is one thousand two hundred miles, to Calgary one thousand two hundred eighty, to Edmonton one thousand four hundred fifty-one miles. From Alberta to Vancouver is slightly over six hundred miles. Port William navigation is open only half the year.

The Pacific harbors are open all the year. Manitoba and Saskatchewan wheat may be rushed forward in time for shipment before the close of navigation. Because Alberta is farther west and must wait longest for cars, very little of her wheat can be rushed forward in time; so Alberta wheat must go on down to St. John, another one thousand two hundred miles. Look at the figures--six hundred and fifty miles from Alberta to the seaboard at Vancouver, two thousand four hundred miles from Alberta to sea-board at St. John! In other words, while a car is making one trip to St. John and back with wheat, it could make four trips to Vancouver.

One year the crop so far exceeded the rolling stock of all the railroads in America that millions of dollars were lost in depreciation and waste waiting for shipment. This state of affairs does not apply to wheat alone nor to Canada alone. It was the condition with every crop in every section of America. I saw twenty-nine miles of cotton standing along the tracks of a southern port exposed to wet weather because the southern railroads had neither steamers nor cars to rush shipments forward for Liverpool. In New York State and the belt of middle west states thousands of barrels of fruit lay and rotted on the ground because the railroads could not handle it. In an orchard near my own I saw two thousand barrels lie and go to waste because there were no shipping facilities cheap enough to make it worth while to send the apples to market. Hill has said that if all the fruit orchards set out in western states come to maturity, it will require twenty times the rolling stock that exists today to ship the fruit out in time to reach the market in a salable condition. The same of wheat, especially in the West, where wheat is raised in quant.i.ties too great for any individual granary. A few years ago, when the northwestern states had their banner crop, piles of wheat the size of a miniature town lay exposed to weather for weeks on Washington and Idaho and Montana railroads because the railroads had not sufficient cars to haul it away.

The same thing almost happened in Canada one fall, though conditions were aggravated by the coal strike.

Now, then, where does Panama come into this story? What if the railroads did not carry the crop two thousand four hundred miles to seaboard in order to ship forward to Liverpool? What if they carried some of the big crops only six hundred miles west to sea-board on the Pacific? They would have four times as many cars available to handle the crop, or they could make just four times as many trips to Vancouver with the same cars as to the Atlantic seaboard after the close of navigation in the East. It is apparent now why the Pacific ports have gone mad over the possibilities from Panama and are preparing for enormous traffic. Of course there are features of this diversion of traffic to new channels which the lay mind will miss and only the traffic specialist appreciate. For instance, there is the question of grade over the mountains. The Canadian Pacific Railroad meets this difficulty with its long tunnel through Mount Stephen. The Grand Trunk declares that it has the lowest mountain grade of all the transcontinentals. The Great Northern uses electric power for its tunnels, and Los Angeles will tell you how its new diagonal San Pedro road up through Nevada puts it in touch with the inland empire of the mountain states by running up parallel with the mountains and not crossing a divide at all.

IV

Take a look at the subject from another angle! At the present rate of homesteading in the West, within twenty years the three prairie provinces will be producing seven to nine hundred million bushels of wheat a year. Possibly they will not do so well as that, but suppose they do; the three grain provinces of Canada will be producing as much as the wheat produced in all the United States. Now, the United States to take care of its crop has practically seven transcontinentals and a host of allied trunk lines like the Illinois Central, the New York Central and the Pennsylvania; but when a big crop comes, the United States roads are paralyzed from a shortage of cars. Canada has only three big transcontinentals and no big trunk lines to take care of a crop that may be as large as the whole United States crop. Panama promises, not a menace, but the one possible avenue of relief to the railroads.

Of course eastern cities may fight a diversion of traffic to the seaboard of the West, but they can not stop it. Portland is already one of the big grain shippers and will bid for a share of Canada's west-bound grain, if Vancouver and Prince Rupert do not prepare for the new conditions.

Not only terminals but elevators must be prepared on the Pacific.

Terminals mean more than railroad company tracks. They mean city-owned trackage, so that the tramp steamer seeking cargo at cheap rates shall have every inducement and facility for getting cargo. They mean free sites for manufacturers, not sky-rocket boom prices that keep new industries out of a city. Elevators and terminals have been announced time and again for Vancouver, but up to the present the announcements have not materialized. Regular grain steamers must be put on, steamers good for cargo of three hundred thousand and four hundred thousand bushels, as on the lakes, and with devices for such swift handling as have made Montreal one of the best grain ports in the world, in spite of high insurance rates and half-season. As long as there are no elevators at Vancouver, grain must be sacked. Sacking costs from five to six cents extra a bushel, and more extra in handling. The remedy for this is for the Pacific ports to build elevators; and even when they haven't elevators, the saving in rates over and above the extra sacking has already been from eight to fourteen cents a bushel on grain billed for Liverpool via the one hundred ninety miles of rail over Tehuantepec, or via the Panama railroad, where bulk need not be broken twice.

An objection is that in the humid Pacific Coast winter climate there is danger of grain heating. This has been overcome at Portland, and against this must be set the incalculable advantage that Pacific Coast ports are open all the year round. One year, of 65,000,000 bushels of grain from the prairie provinces that pa.s.sed over the Great Lakes forty-three per cent. went out by way of Buffalo to American ports.

Why? Because the glut was so great, the facilities so inadequate for the enormous crop, the insurance so high, that the grain could not be rushed seaward fast enough before close of navigation. Through Vancouver during this very period there pa.s.sed only 750,000 bushels of wheat. Why not more? No facilities.

"We could have shipped millions of bushels of wheat to Liverpool by way of Vancouver," said the head of one of the largest grain companies in Calgary, "but there were simply no facilities to take care of it. On 16,000 bushels, which we shipped by way of Vancouver and Tehuantepec, we saved eight cents a bushel, as against Atlantic rates. You know how much handling the Tehuantepec route requires. Well, you can figure what we should save the farmer when Panama opens and the cargo never breaks bulk to Liverpool from our sh.o.r.e."

Rates, not heating nor sacking, are the real cloud in the Canadian mind regarding Panama; and if Canada continues to stand twiddling her hands over rates when she should be hustling preparations, the inevitable will happen--Portland, which sends millions of bushels of her own wheat to Liverpool, is ready to take care of Canada's traffic; so is Seattle.

There is nothing these cities hope more than that Canada will continue to shun the question of rates.

V

Let us look at this question of rates!

Ordinarily the rate on wheat from Chicago to New York is about ten to twelve cents a bushel; from New York to Liverpool about three to seven cents. That is, for one thousand miles (roughly) the rate by rail is ten cents. For three thousand miles the rate by water is three cents.

That is, one cent buys the shipper one hundred miles by rail. One cent buys him one thousand miles by water. Get out a chart and figure out for yourself what the saving means on wheat via Panama to Liverpool on a crop--we'll say--of one hundred million bushels, Alberta's future share alone, leaving Saskatchewan and Manitoba crops to continue going to Liverpool by Fort William and Montreal. You can figure the distance to Liverpool via Panama twice or even three times as far as via Atlantic ports, long as water rates are to rail, as one to ten, the saving on a one-hundred-million-bushel crop for a single year is enough to buy terminals, build elevators and run civic ships as Boston and New Orleans and St. Louis and Kansas City and Portland are doing. Via Tehuantepec the saving was eight cents a bushel. At that rate your saving in a year would be eight million dollars for Alberta wheat alone, not counting dairy products, which are bound to become larger each year, and coal, which will yet bring the same wealth to Alberta as to Pennsylvania, and lumber, on which the saving is as one to four.

Please note one point! It is a point usually ignored in all comparisons of water and rail rates. While sea and lake are the cheapest method of transportation in the world, ca.n.a.ls (unless some other nation builds them as the United States built Panama) are not so cheap as sea and lake. When you add to the cost of ca.n.a.ls, the interest on cost, the maintenance, and charge that up against traffic--for it doesn't matter, though the government does maintain ca.n.a.ls; you pay the bill in the end--ca.n.a.l rates come higher than rail rates. But in Canada's use of Panama, Canada is not paying for the building of the ca.n.a.l; and the Lord pays the upkeep of the ca.n.a.l of the sea.

Take this question of Vancouver rates, from which Canada is standing back so inertly! Take the latest rates issued! These are subject to change and correction, but that does not affect final conclusions. It costs Manitoba and Saskatchewan from twelve to nineteen cents a hundred weight to send grain to Fort William, then during open navigation from four to five cents to reach seaboard at Montreal. It costs Alberta, being farther west, twenty-five cents to reach Fort William; but, as a matter of fact, her wheat can seldom reach Fort William before the close of navigation; so she must pay twenty-five cents more to send her wheat on down to St. John, and five to six cents from St. John to Liverpool, or in all fifty-five cents. The Alberta rate is twenty-two cents plus a fraction to Vancouver, or forty-five cents to Liverpool.

Now, Alberta wants to know: Why is she charged twenty-two and a fraction cents for six hundred fifty miles west, and only twenty-five cents for one thousand two hundred miles east?

There is the nub and the rub and the hub of the whole thing, and the discrimination bears just as vitally on fruit and dairy products and lumber and coal as on wheat. It is a question that has to be settled in Canada within the next few years, or her west-bound traffic will build up Portland and Seattle instead of Vancouver and Prince Rupert.

The whole problem of the effect of Panama is so new in Canada that data do not exist to make comparisons; but details have been carefully gathered by American ports, and the cases are a close enough parallel to ill.u.s.trate what Panama means in the world of traffic to-day.

Freight on a car of Washington lumber to New York is from three hundred ninety-five to four hundred eleven dollars; by water, the freight is from one hundred to one hundred and seventy-five dollars. To bring a car of Washington fir diagonally across the continent to Norfolk costs eighty-five cents a hundred weight. To bring it round by Panama costs twenty cents, or to ship the very same cargo from Norfolk to England--which many southern dealers are now doing--costs twelve to fifteen cents, including the handling at both ends. Dry goods from New York to Texas by water cost eighty-nine cents; by rail, one dollar and eighty-two cents. Oranges by rail from the Pacific to the Atlantic cost twenty-three dollars a ton; by water before the ca.n.a.l opened, breaking bulk twice, ten dollars, and through the ca.n.a.l, when bulk is not broken, will cost only five to eight dollars. On oranges alone California will save twenty million dollars a year shipping via Panama.

The Balfour-Guthrie firm of Antwerp can ship a ton of groceries from Europe to Los Angeles round the Horn for the same amount the Southern Pacific ships that ton from Los Angeles to San Francisco--namely, six dollars plus. The rail rate on salt in Washington is eight dollars seventy cents for eighty-eight miles; the river rate one dollar fifty cents. I could give instances in the South where cotton by rail costs two dollars a bale; by water, twenty-five cents.

If Panama works this great reduction, this revolution, in freights, will that not hurt the railroads? Ask the railroads whether they make their profit on the long or the short haul. Ask them whether high rates and spa.r.s.e population or dense population and low rates pay the better dividends! Compare New York Central traffic receipts and Southern Pacific on the average per mile! Now ships that are to use Panama plan pouring twenty million people into the Pacific Coast in twenty years.

Will Canada share the coming tide of benefits? Only two things can prevent her: first, lack of preparation--too much "hot air" and not enough hustle; too much after-dinner aviating in the empyrean and not enough muddy mess out on the harbor dredge with "sand hogs" and "shovel stiffs"; then, second, lack of adequate labor to prepare. After-dinner speeches don't make the dirt fly. Canada wants fewer plat.i.tudes and a great deal more of good old-fashioned hard hoeing.

CHAPTER XI

TO EUROPE BY HUDSON BAY

I

It must have become apparent to the most casual observer that transportation has been to Canada more than a system of exploitation by capital. Transportation has been to Canada an integral part of her very national life--which, perhaps, explains how with the exception of extravagance incident to a period of great prosperity her railroad systems have been founded on sound finance from bed-rock up. In spite of huge land grants--in all fifty-five million acres--and in the case of one railroad wild stock fluctuations from forty-eight to three hundred dollars--it is a question if a dollar of public money has ever been diverted from roadbed to promoters' pockets. Certainly, in the case of the strongest road financially in Canada, no director of the road has ever juggled with underground wires to unload worthless securities on widows and orphans. Railroad stocks have never been made the football of speculators. Charters in the old days were juggled through legislatures with land grants of eight and twelve thousand acres per mile; but at that time these acres were worthless; and the system of land grants has for the last ten years been discontinued.

Because railroads are a necessary part of Canada's national development, state aid of late has taken the form of loans, cash grants and guarantee of bonds by provincial and federal governments. This has given Canada's Railway Commission a whip handle over rates and management, which perhaps explains why railroads in Canada have never been regarded as lawful game by the financial powers that prey.

Including munic.i.p.al, provincial and federal grants, stocks and bonds, Canada has spent on her railroads a billion and a half. Including capital cost and maintenance, Canada has spent on her ca.n.a.ls $138,000,000. On steamship subsidies, Canada's yearly grants have gradually risen from a few hundred thousands to as high as two millions in some years. Nor does this cover all the national expenditure on transportation; for besides the thirty-eight millions spent on dredging and improving navigation on the St. Lawrence, twelve millions have been appropriated for improving Halifax Harbor; and only recently federal guarantee for bonds to the extent of forty-three millions was accorded one transcontinental. This road was so heavily guaranteed by provincial governments that if it had failed it would have involved four western provinces. Its plight arose from two causes--the extravagant cost of labor and material in an inflated era, and the depression in the world money markets curtailing all extension.

Workmen on this road were paid three to seventeen dollars a day, who would have received a dollar and a half to four dollars ten years ago.

In fact, the owners of the road themselves received those wages thirty years ago. Sections cost one hundred thousand dollars a mile which would formerly have been built for thirty thousand; and prairie grading formerly estimated at six to eight thousand dollars a mile jumped to twenty and thirty thousand dollars. In coming to the aid of the Canada Northern, the government did no more than Sir John Macdonald's government did for the Canadian Pacific Railroad in 1885, and the prosperity of the Canadian Pacific Railroad has amply justified that aid.

Canada's transportation system has been a national policy from the first. Her first transcontinental she built to unify and bind confederation. Her second two transcontinentals she launched to carry commerce east and west, because the United States had built a tariff wall which prevented Canada moving her commerce north and south. Her ca.n.a.l system to cut the distance from the Great Lakes to the seaboard and to overcome the rapids at "the Soo," at Niagara and on the St.

Lawrence--has simply resolved itself into an effort to move seaboard inland, on the principle that the farther inland the port the shorter the land haul and the lower the traffic toll. Owing to the enormous increase in the cargo capacity of lake freighters in recent years, grain ships reach Buffalo carrying three hundred thousand bushels of western wheat, and Canada's Welland Ca.n.a.l has worked at a handicap.

Until the Ca.n.a.l is widened, the big cargo carriers can not pa.s.s through it, and the necessity to break bulk here is one explanation of more than half Canada's western traffic going to seaboard by way of Buffalo instead of Montreal.

For years the proposal has been under consideration to connect the Great Lakes with the St. Lawrence by way of a ca.n.a.l from Georgian Bay through Ottawa River. This would be a colossal undertaking; for the region up Mattawa River toward Georgian Bay is of iron rock, and to build a ca.n.a.l wide enough for the big cargo carriers would out-distance anything in the way of ca.n.a.l construction in the world. Both parties in Canada have endorsed what is known as the Georgian Bay Ship Ca.n.a.l; and estimates place the cost at one hundred and twenty-five millions; but traffic men of the Lakes declare if the big cargo carriers are to have cheap insurance on this route, the ca.n.a.l will have to be wide enough to guarantee safe pa.s.sage; and the cost would be twice this estimate.

On no section of her national transportation has Canada expended more thought and effort than improving navigation on the St. Lawrence.

This, in its way, has been as difficult a problem for a people of seven millions as the construction of Panama for a people of ninety millions.

Consider the geographical position of the St. Lawrence route! It penetrates the continent from eight hundred to nine hundred sixty miles. Montreal, the head of navigation on the St. Lawrence, is the farthest inland harbor of America with the exception of two ports--Galveston on the Gulf of Mexico and Port Nelson on Hudson Bay.

Galveston is seven hundred miles from the wheat fields of Kansas. Port Nelson is four hundred miles from the wheat fields of Manitoba.

Montreal is--roughly--a thousand miles from the head of the Lakes, one thousand five hundred miles from the wheat fields of Manitoba, two thousand two hundred miles from the wheat fields of Alberta.