Chapter X: Battling for Life

We can say at once, in explanation of the financial struggles before mentioned, that the Canadian Pacific Railway was constructed to a finish across Canada in a period of monetary storm and stress. Leaving out of count the early years when the successive Governments were building short stretches here and there, in a way so leisurely that no financial difficulties occurred, beyond the ordinary impecuniosity which haunts all Governments, the period from 1881 to 1885 was pre-eminently a difficult time. During those years everybody was having what men on the prairies call “hard sledding”—an expression taken from the experience of travel with sleighs when the thaw has left bare patches on the plains. On those patches the sleigh runners catch with a disheartening tenacity and impede progress. At such junctures it is fortunate if there are several men travelling together, because by “doubling up” their teams, they can get over the otherwise impossible gap. Life is full of opportunities for mutual helpfulness, and the great railway which now spans the continent and bridges the oceans found itself more than once, in the construction period above mentioned, at the end of its resources and had to call on the Dominion Government for temporary assistance. It was a case where “doubling up” became necessary if the hard places were to be traversed. We are not sure that the Government was as willing and ready to assist as the ordinary good-natured and open-hearted teamster used to be on the prairie. But even a Government, which should be cautious because it handles trust funds for the people, may be brought to see when an unforeseen expenditure can be and must be made, in the interests of the people themselves. In this particular case of the Dominion Government and the Canadian Pacific Railway the Government would not and did not at any time give even a temporary loan till it had made the most exhaustive investigation into the whole problem. There are some facts so outstanding that even a superficial investigation could find, without much delay, why the Company required and deserved temporary assistance by way of loan during the construction period in a trying era.

It should be remembered, to begin with, that the principal men in the Company, Stephen, Smith and Angus, were men of practically independent means before they entered on railroading with Hill in St. Paul. In their association with Hill, owing to causes set forth in a preceding chapter, they had become very wealthy in a short time and hence did not have to take up any further work of the kind. Of worldly goods they had enough and to spare and might have reasonably, from their own standpoint, have continued the even tenor of their ways in their ordinary and familiar occupations in Canada. But Sir John Macdonald, as soon as he knew that their wealth had become great, and that they would be looking for new avenues for investment, approached them with an appeal to undertake the completion of the Canadian Pacific Railway. It was the biggest railway construction project in the world, and the proposal to build the road, except by slow stages, was characterized, not only by prominent public men, but by some well-known experts, as sheer madness. Stephen, as we have seen, was not disposed to go into such a huge undertaking at all. There was no mercenary reason why this already successful trio should make this hazardous attempt. However, the appeal of patriotic duty to their country, as well as the fascination of immensity in task, finally drew these Canadian men into the enterprise. And once they took up the matter it is well-known and can now be told that they put not only themselves, but all they had, into the determination to carry it through to a successful issue. Hence they deserved the commendation of the country and not the condemnation, for their gallantry.

Twice the Company had to apply to the Government for either loan or guarantee of bonds and during the months when these matters were hanging in the balance, the founders of the Company and the General Manager and Purchasing Agent, as well as other responsible officials, passed through what can be truly called, agonizing experiences. To these experiences they gave utterance at times. It is anticipating somewhat and disregarding sequence for the moment, but during those years we have it on the word of friends that Stephen returned one evening to the Russel House after a vain effort to get Sir John A. Macdonald to say that he would recommend that a loan should be made. Stephen, upon whom, as President, there was unusual strain, threw himself into a chair in the rotunda and when an acquaintance passing the time of day said, “How are you?” Stephen, without looking up, replied “I feel like a ruined man.” One day he shed tears in the office of Mr. Collingwood Schreiber, not because he cared for himself, but because it looked as if the whole great project of the Canadian Pacific was going to a crash that would block the future of Canada for a time at least. On another night Mr. Stephen, after a hopeless sort of interview with the Government, came down the Russel House stair grip in hand and told Senator Frank Smith, a gallant friend of the railway, that he was going to Montreal to make a personal assignment of all he possessed. Even the redoubtable Van Horne wired frantically one day that the pay car could not go out because there was nothing in it! On another day he said to Mr. Schreiber at Ottawa, “If the Government does not help us we are finished.” And shortly afterwards, meeting Sir John Macdonald in the corridor, he said, “Sir John, we are dangling over the pit of hell and ruin.” On another occasion, when the Directors were in session, the Chairman said, “Gentlemen, it looks as if we had to burst——” But Donald A. Smith looked hard at him and said, “It may be that we must succumb, but that must not be as long as we individually have a dollar.” And it is related that he went out and raised on his personal security enough to meet pressing accounts which Shaughnessy said had to be paid at once.

My impression is that Donald A. Smith, with that craggy head and beetling brow of his, was the most doggedly determined Director of them all, though less able as a financier and diplomatist than Stephen, to whom, generally speaking, those who know the history of the road quite properly give endless credit for his masterly work as President of the Company. After writing the preceding sentence, I came across the following statement by Sir Charles Tupper, who himself did so much to carry the great project through. He said in 1897: “The Canadian Pacific Railway would have no existence to-day, notwithstanding all the Government did to support the undertaking, had it not been for the indomitable pluck and energy and determination, both financially and in every other respect, of Sir Donald Smith.”

I can quite understand some reader putting in a question here, as to how it was that men of such ability, after having estimated the cost of constructing the Canadian Pacific, found themselves at the end of their resources within two years of their taking the contract. It is not enough to say, although it was true, that there was an immense amount of unexpected expenditure in battering the way through the Laurentian rocks on the North Shore of Lake Superior, and in boring a road through the mountains of British Columbia. There were other causes for the hard circumstances that came upon the railway. The chief reasons for the financial difficulties of the Railway Company, beyond what has been already indicated, lay in the facts that, succeeding the boom inflation in the West in 1881, there came a very serious depression all over the country. On account of this, immigration fell far short of what was expected. In consequence, both freight and passenger traffic was very scanty. The Railway Company, for the same reasons, could not realize anything worth while on its land, which was for the first ten years a drag on the Company rather than an asset, as can be readily ascertained by a study of the question. Thus the two main sources of expected revenue failed to materialize. In addition, the threatening discontent of the half-breed population which culminated in the Riel outbreak, further discouraged the incoming of settlers. Resolutions, passed unwisely at conventions in Manitoba, warning immigrants not to come until there were other railways linking up with the States, being used by immigration agents for other countries, created a bad impression as to the Canadian West. And because investors abroad were also influenced against the Canadian Pacific at the financial centres of London and New York, by certain rival railway interests, the assets of the Canadian road could not be turned into money. In this connection it is well to recall again the bitter “Disallowance” agitation carried on against the Canadian Pacific, chiefly in Manitoba, all through the construction period. There was persistent effort made by that Province to charter local railways, mainly linking up with the United States systems, despite the clause in the Canadian Pacific contract with the Government to the contrary. The charters granted by Manitoba were promptly disallowed by the Dominion Government, mainly, first, because of the contract with the Canadian Pacific, second, because money could not be raised to build the main line of the Canadian Pacific if the productive areas along that road should be tapped by rival roads, and, third, because it was contended that the East had made tremendous sacrifices to build the road and that on that account Western traffic ought to go over the North Shore to build up the Eastern part of Canada, rather than go southward to build up a foreign country.

The Canadian Pacific, in self defence, would not yield to the granting of rival charters, and the Dominion Government said they would keep faith according to the terms of the contract. But Manitoba would not be appeased and made many attempts, even to violence, to break the “monopoly” clause. I recall passing on a Canadian Pacific train to Southern Manitoba, and seeing large forces of men at a point where a road from the south was striving to cross the Canadian railway. A Canadian Pacific locomotive on a switch hastily constructed, barred the way and some 200 men stood beside it to prevent the crossing. The agitation checked immigration, and produced altogether a condition exceedingly harmful to the West for a time. But the Canadian Pacific was clearly within its rights and this was part of its battle for life during that period.

One cannot remember that fiery era without recalling how fortunate it was for the Canadian Pacific Railway that its Western representative was William Whyte, a princely type of man, whose courage, imperturbable coolness and inflexible determination made him a tower of strength. People might fight the railway, but no one of right mind could dislike William Whyte, whose high character and immense personal popularity with all classes, including especially all employees of the road, made him unassailable. Leaving much of the administration of his office to men like the genuine, and diplomatic, “Jim” Manson, Whyte (who was knighted later for his services to the Empire) gave much time to the “disallowance” problem, and to preventing open trouble as far as possible. But there was general satisfaction when Manitoba, under the continued work of men like John Norquay, Thomas Greenway and Joseph Martin, in the local Government of Manitoba, persuaded the Dominion authorities to cancel the “Monopoly” clause by giving the Canadian Pacific compensation. The whole agitation, however sincere, had greatly hampered the development of the country, and crippled very considerably the efforts of the Canadian Pacific in a confessedly difficult period of wide-spread depression.

Some railways in the wealthy country to the south were, for various reasons, going into the hands of the receivers during the construction period of the Canadian Pacific. So that, despite the consummate ability of the Canadian Pacific financiers, it is small wonder that the Company saw bankruptcy looming up ahead. Even Stephen and Shaughnessy could not make bricks without straw. And all the time Van Horne was driving ahead with construction at top speed. He knew the situation, but declared that any stoppage or even slackening up would lead to the Company being pounced on by creditors, who would wind it up. His view was that the whole undertaking must be kept alive as a hopeful, going enterprise, and that its position would improve immensely when it, refusing to acknowledge defeat, spanned the continent to the Western seas. Even then, Van Horne, as after events proved, had his eye on trade with the Orient as a great feeder to the road. So he went ahead, and let the others find the money, though at times he took a hand, in his trenchant way, in letting the Government know what he thought of the whole situation.

It was late in 1883 when the Canadian Pacific, which had been keeping the facts before the Government at Ottawa, made formal application for a loan of twenty-two and a-half millions to ward off failure. The situation was desperate, but the Government, which had a lively recollection of the fight put up against the original contract, was afraid to risk defeat by granting the request. The security offered for the loan was to all appearance ample, as it included a lien on the Company’s main line, the branch lines in Manitoba, and the unpledged land grant. In addition they gave the astonishing pledge that they would clip five years off the contract term and finish the road in 1886. Sir John Macdonald, who always kept his hand on the public pulse, knew that people in the East were being persuaded by the Parliamentary Opposition that the West was being developed at the expense of the East. Men in his own cabinet and many of his supporters in the House, were being infected with that idea, despite all efforts to make them see that, in the long run, the development of the West would be an immense gain to the East. Sir John, with the prospect of a divided cabinet, possible defection amongst his own followers in the House, as well as the bitter attitude of the Opposition and the likelihood of a revolt in the country against the granting of the loan, was indisposed to yield. Things looked black for the Canadian Pacific. Stephen was utterly discouraged after interviews with Sir John, and it was on one of those occasions that he was giving up and leaving Ottawa for Montreal when Senator Frank Smith prevailed on him to wait over till they would have a midnight interview with Sir John. Even that interview seemed fruitless till Mr. John Henry Pope went to Sir John and told him that if the loan was not granted, the Canadian Pacific would go to the wall, the Conservative party would go with it, and all Canada would be in a panic. Sir John did not want to smash Canada nor the Conservative party, and he explained that he was personally in favour of the loan and would try to get his Cabinet and party united in an effort to put it through the House. This was enough for Mr. Pope, who knew Sir John’s powers, and at two o’clock in the morning Pope returned to the well-nigh despairing Stephen and the rest, and uttered simply the tonic words, “Well, he will do it.”

In the meantime Sir Charles Tupper, who, while still holding the portfolio of Minister of Railways, was in London as High Commissioner for Canada, had been cabled for to come to the rescue. He left for Ottawa at once and, on arrival in Canada, found everybody at their wits’ end. He got Mr. Miall, the expert Government accountant, and Mr. Collingwood Schreiber, the highly respected and able Government engineer, to work on the Railway Company’s books in Montreal. They reported everything satisfactory, and Mr. Schreiber, whose word went a long way, recommended the granting of the loan.

But there was still the task of getting the Cabinet united on the subject, and the caucus of the Government members in the House into a favourable and unanimous attitude. Fortunately for the Government and the Canadian Pacific and the country at large, the Cabinet had in its number the rare personalities of the magnetic and diplomatic Sir John Macdonald and the formidable, fearless Sir Charles Tupper, who made a sort of irresistible combination. Sir John could sway by the conciliatory eloquence and the appealing personal touches which held the devoted allegiance of his party to the “old Chieftain” through many extraordinary vicissitudes in his long career. Sir Charles could marshal arguments with the consummate forensic power of which he was a master, and thus became a veritable regiment of storm troops to carry his points and reach his objective. These two men solidified their own party and, despite a fierce resistance from their opponents in the House, the Bill authorizing the loan was carried, as Sir Charles said, “at the point of the bayonet.”

This relief gave the Company a new lease of life and the work, which had never slackened, even though men had to wait for their pay, was forced ahead by the aggressive Van Horne, while Shaughnessy handled every dollar with such consummate skill that it seemed to do the work of two. But the terrific expenditure in construction on the North Shore and through the mountains, caused the twenty odd millions to melt like snow before the sun. Smashing the rocks and levelling up the chasms on the North Shore and finding a sure foundation in shaking and almost bottomless morasses which sucked down material like an insatiable undertow, all meant enormous unforeseen expenditure. The Company would not allow any careless work and, if necessary, the contractors would stay at one spot for months till the road-bed was absolutely secure. Van Horne was rushing to complete the railway, but he was too thorough a railroader to sacrifice security to speed in construction. Expense was of no consequence. He was going to “get the work done right and send in the bills to Stephen and Shaughnessy.”

Just at the juncture when the railway seemed in imminent danger of coming to a sudden halt because its coffers were again bare, and the Government was afraid that the country would not stand for any more assistance to be given to what some thought was a wild commercial venture, an event occurred which threw the Canadian Pacific into the limelight as an undertaking of immense Imperial value. That event was the Riel Rebellion, which Van Horne had foreseen as a possibility and concerning which he had warned the powers at Ottawa when he told them that if it did occur, he would carry troops from the East to the prairies in the space of a few days. Sir John Macdonald and the Government, with a strange pertinacity, born of the mysterious red tapeism of Regina officialdom, refused to think such an event possible. However, it came with sudden and deadly emphasis when at Duck Lake, in March, 1885, on the North Saskatchewan, a small force of civilians and police suffered heavily in a sort of rebel ambuscade. Fifteen years before, this same Riel had, at Fort Garry, run amuck, and then it had taken six months for the soldiers under Col. Wolseley, coming by land and water, to reach the scene. Now, in 1885, with the Lakes frozen and no chance of going through the United States with armed men, the whole middle West might be swept by the carnage of semi-savage rebels on the war path. The time had come for Van Horne to play a winning card, and he played it. The Government made frantic appeal to him because months before he had intimated his willingness to help in such an event. But before their appeal was actually known to the general public, Van Horne had trains ready with steam up at the centres in the East where troops would make their points of departure. He knew that there were gaps on the North Shore and that there would be hardships, but to reduce these to a minimum he stipulated that he and Shaughnessy and the Railway Company officials should have complete control of both transportation and commissariat. He always believed, for he had proven it by many a test, that when men were well fed with nourishing food and stimulated for special effort with strong black coffee, they could do and endure greatly. And so he would not leave the soldiers to the tender mercies of inexperienced quarter masters with meagre supplies on the bleak North Shore of Lake Superior.

In one or two places the soldiers had to march along the shore-ice on the lake. In other places they were taken by teams and sleighs, or else on flat cars over some hastily laid track. They had what might well be called a hard time over part of the way, but soldiers do not expect luxury on active service, and they got through in fewer days to Winnipeg than it had taken of months to accomplish in Wolseley’s expedition, years before. From Winnipeg the troops, with their Western comrades, were distributed by rail and trail over the plains as far as the mountains, and the rebellion was soon quelled. From that day the most fiery opponents of the North Shore section of the Railway, the chief point of critical attack, found their calling gone and had to subside. Some of them would still oppose the whole system through force of habit, but the extraordinary and unexpected service rendered by the Railway in a crisis time would make it comparatively easy for even a cautious Government to give temporary help to the Company, with the consent and approval of the grateful Canadian people. Not only so, but the Canadian Pacific Railway had thus suddenly become of such significance and value as an all-British route across the North American continent, that men in the Old Land who believed in the continuance of the Empire, realized as never before that a new factor in Imperialism had come into history. This railway was seen to be, not only a commercial transportation company which traversed a portion of an overseas Dominion, but a great link in the chain of an Empire that girdled the earth. It would no longer be ignored in the financial circles of London, where the centre of Empire stood.

Meanwhile, right on through the rebellion, the work was being pushed ahead in the mountains, although it was not generally known then that the Company at first had boldly thrust its spear-head against the embattled hills without very definite knowledge of how it was to get through beyond the Rockies. The Kicking-Horse Pass showed the way, along its flashing, frothing river, through the Rockies, but for some time there was doubt about how the Selkirk Range was to be pierced. So anxious was the Company about this problem that Mr. Sandford Fleming, the famous engineer, was summoned by cable from the Old Country to look into the situation. He journeyed by train to Calgary and went by trail through the Kicking Horse, but just then Major Rogers, a hard-bitten, adventurous man, acting on some information given by Walter Moberly years before, discovered the famous pass called Rogers’ Pass to this day. Rogers was an American engineer who, with his son Albert (after whom Albert Canyon was called by Principal Grant of Queen’s University, Secretary to Sandford Fleming on his journeys), had explored amid much hardships to find a pass through the Selkirks. When he did find it, the Company was so pleased that a bonus cheque for $5,000 was sent to Rogers. A few months afterwards Van Horne met Rogers and reminded him that he had never cashed the cheque. Rogers, who was well educated, but rough at times in temper and language, evidently had abundant sentiment withal. For he replied, “Do you think I would cash that cheque? I was not out there for money, but to have a hand in a big project. No, sir, I have that cheque framed in my brother’s house in Waterville, Minnesota, where my nephews and nieces can see it as a token of some work their old uncle did in his time.”

Contractors who became famous later on in various ways were at work on the mountain section. The work on the prairies had been child’s play compared to it. A good old Scotch elder who came in to see me at the Coast twenty years ago was amazed at the enormous task that had been accomplished. In political life in Manitoba he had attacked what people called “the ruinous expenditure” on the road. But he said to me then, in 1903, in Vancouver: “Now that I have seen it I wonder that men ever undertook the work at any price, and so far as I am concerned I am through with criticism of the expenditure on construction.” And then the good man added, “The fact is that if the good Lord had not bored through the mountains with rivers, there is not enough money in the Empire to build to the Coast.” There was much in what this honest man said that day.

The expenditure was almost incredible. Where the rivers ran, there was, for miles on end, the necessity for cutting into the solid rock to get room for the road-bed and trains. There were miles of snowsheds to be built, and tunnels through solid rock almost without number. Up the mountain sides there were built various devices to protect the road and make it safe from slides and avalanches. Rivers were deflected from their channels and retaining walls were built. When I first passed over the road, not many years after it was opened, there seemed to be leagues of trestles, now filled in or replaced by steel or tunnels. Everywhere there was need for the ceaseless flow of millions of money. But Van Horne, who knew all about the business, saw that nothing was left undone to make the road beyond criticism. And so well was the work done that once, shortly after the road was completed, Van Horne, who was taking some arbitrators over the mountains to value the government construction section, had the engineer run over fifty miles an hour to show these gentlemen “that the Company section was a real railroad even if the government sections were not.”

It was no wonder that with the vast expenditure indicated by the above paragraphs the Directors saw that they must raise some more millions or perish.

Accordingly, in 1885, when the Riel Rebellion, by reason of the service rendered by the Canadian Pacific Railway in transportation of troops, had been quelled, Stephen approached the Dominion Government again for assistance. The rebellion services of the railway had solidified the Government support in the House, which was then in session, and had pretty well silenced the Opposition. The assets of the Railway were already subject to a lien for the former loan, but the Government, besides a few minor concessions, finally allowed the Directors to issue $35,000,000 stock, of which it was to guarantee $20,000,000, the rest to be issued by the Railway Directors. Stephen went to London, not very hopefully, to sell this bond issue. The Directors in Canada waited anxiously to hear the result, for the bankruptcy of the road and of the Directors (though they cared less for that) was only hours away if Stephen’s mission failed. Sir Charles Tupper, then High Commissioner for Canada in London, that steadfast friend of the road, had done some most effective preparatory work with the famous banking house of the Barings, of which Lord Revelstoke was the head. Stephen had scarcely begun his explanation of the situation when Lord Revelstoke broke in and said, “We have been looking into the whole matter already. We are satisfied with the outlook in Canada and the future of the Canadian Pacific Railway, and will take over the whole issue of your stock at ninety-one.” Stephen was overjoyed, because the question of the solvency of the great railway was settled for all time. He sent an exultant cable at once to Canada. Mr. Angus and Mr. Van Horne were in the Board Room in Montreal when it was delivered. They read it with a sort of glad surprise too deep for words. They were matter-of-fact men, but they shook hands with some emotion. Then they threw some of the chairs about and danced around the room. The relief to the tension had come and they had to relax somehow. They were human.

They knew in that hour that the road would be completed. And out along the line in the great mountains there would be a station called Revelstoke. And where the steel met from the East and the West, there would be another station named “Craigellachie,” after the Gælic cablegram meaning “stand fast,” which Stephen, as we have already recorded, had sent to his cousin, Donald A. Smith (Strathcona), in the dark days some years before. The name would remind succeeding generations of the men whose steadfastness was like unto that of Craigellachie, the unshaken rock in the old glen of Strathspey.