of the enterprise only, to the Grand Trunk railway company, to pay or to indemnify them for financing the Grand Trunk Pacific for a distance of 1,800 miles. That was quite proper. We are creating to-day $100,000,000 of stock on the Canadian Northern Railway system, on a system which comes to us and says that they are not able to carry on their enterprise, that they are at the end of their financial ability. There is no comparison, and more than that there is in clause 12 a proviso for another 25 million of stock for the purpose of exchange of income charge convertible debenture stock secured by trust deeds to the British Empire Trust Company, Limited, the National Trust Company, &c., not exceeding $25,000,000. That makes $125,000,000. If the Government is to get twofifths of that instead of 40 millions, which we are about to get, they should get fifty millions. If I understand this thing properly they should have two-fifths of that amount, which would be 50 millions. I find later on in the trust deed that there will be only thirty-three millions given to the Government, not forty millions of this common stock. I do not think this common stock will be worth very much for many years to come. There are the thirty-three millions and the seven millions of stock which was printed last year. They simply got the printing press in motion, and they printed out seven million dollars worth of certificates, which they handed to the Government when they received the fifteen million cash. The seven million and the thirtythree million would make forty million, but they are still twenty million short on that twenty-five million income charge convertible stock. However, it seems to me it should be fifty millions instead of forty, but I would not be sure about that. When the Government say they will not enforce payment, and no legal proceedings will be taken, I would like to know what they intend to do with this clause. I suppose all the Senators have seen as I have, a sort of fly sheet which is headed: LEGAL INVESTIGATION DEMANDED. Shareholders of Canadian Northern Quebec Railroad Move the Supreme Court of Can- Many Irregularities Claimed. Mackenzie and Mann have acquired by one means or another no less than $4,445,300 out of a total capitalization of some nine millions, and it is claimed by indignant shareholders, that by J. P. Morgan and New Haven methods and bearing the stock, influencing legislation, making it a crime to deal in this stock or even actually on the statute book) in one of the offer it for sale without permission (this is provinces, and generally discrediting the railroad for the purpose of gobbling up the rest, Hon. members may have read this themselves, but to show how this Company has been able to influence the various legislatures, including this Parliament, let me simply read: As a further illustration of the malicious influence, which may be hardly credited but is nevertheless a fact, they have actually succeeded in obtaining unconstitutional Russian star chamber legislation now put on the statute book of one of the provinces as amendment to the blue sky line law, no later than February 20th of this year, 1914, of which the following are samples: This is from the statute: 'or for any person who owns shares, stocks, securities, etc., to sell or attempt to sell in the course of continued and successive acts is liable to a fine of from $50 to $500 or to imprisonment with or without hard labour for not exceeding six months.' And then it continues: This is a specimen of Mackenzie and Mann's influence over legislators, and was enacted with the special object of barring the above stock from Canadian markets, and not only have proceedings been initiated in the local courts to enforce this nefarious legislation, but government officials have already attempted to influence United States authorities in the same direction (but without results) on the ground that this stock is not transferable at the railroad's transfer office in Toronto, and is therefore valueless. Montreal, May 12.-Acting on behalf of Geo. L. Alexander, Messrs. Beattie, Blackstock, Faskin, Cowan and Chadwick, of Toronto, filed an application in the supreme court of Ontario on Saturday, asking for the winding up of the Northern Consolidated Holding Co., Ltd., whose on record. Hon. Mr. CLORAN-Read it and put it 1 fight at first the strong opposition of the Canadian Pacific Railway. As long as they were fighting against that monopoly, for it was a monopoly in the Northwest, I for one did all I could, every time I had a chance, to vote for Mackenzie & Mann's enterprise, because they were giving competion to the people of the Northwest. When they came down to certain parts of Ontario and Quebec I was glad to welcome there a railway giving the public more facilities. But if they have during the last 15 or 20 years displayed all this ability, it all pales into insignificance before what they have been able to accomplish just now. When they have got to the end of their tether, as it were, when they could borrow no money, when everything in sight had been pledged, they were able to come down to this Government this year and obtain from this Government, what? Not only a subsidy and money, but actually obtained from this Government their consent to go into partnership with them; so that now they can go out to the world and say, "Why, look at our partner; the partner is the Dominion of Canada." That is the crowning act of their career, and that is the greatest thing they have ever achieved during the last ten or fifteen years. Hon. Mr. CASGRAIN-It is too long to read all through but the purport of it is that Mr. Ormsby, who is the secretary and a paid official of this company, actually discouraged and told people that those shares had been offered to the company at $2 and $3 a share and that they had been refused by the company, whilst at the same time the shares were selling from $50 to par. Now, I do not wish to detain this House any longer, except just to say that hon. gentlemen will notice that I have not said one disparaging word about Mackenzie and Mann. I consider them by far the cleverest men in Canada, so far as railway, matters are concerned, and I do not think that any member of this Government, including the Solicitor General is any match for them, in making a contract of any kind. They have been wonderfully helped by Mr. Zebulon A. Lash, the able solicitor of the Canadian Northern railway, who with his far superior knowledge of this very involved company, has been able to dictate, to the present administration exactly what would suit them. The ability of Messrs. Mackenzie and Mann, as men, deserves great commendation. I have so stated in a lecture delivered in Toronto before the Empire Club. A banquet was given to Sir Wm. Mackenzie, and he stated Hon. Mr. DAVID.-I desire to give in a that ten years previous to that banquet there was no such thing as the Canadian very few words the reasons why I shall Northern railway, but while he was speak- vote for thie Bill and against the amending he was proud to say that 3,650 miles of ments, the effect of which would be to dethe road was then in operation. This feat the Bill either directly or indirectly. I regret that the Government has not judgshowed that Sir Wm. Mackenzie and Sir Donald A. Mann had been able during ten ing the amendments which were moved by ed it proper to improve the Bill by acceptyears to build, to equip and to put in operation one mile of road, winter and sum-ments which I consider would have been the hon. chief of the Opposition, amendwer, for every calendar day of those ten years. I say that men who can achieve anything of that sort deserve commendation. Since that time they have gone on at a faster rate, and they have been able to construct about two miles per day. Therefore if they made any money out of this enterprise, I am not the one to find fault with them. They have great ability, and I do not think there is anybody superior to them either in the Canadian Pacific railway or in the Grand Trunk railway or the Grand Trunk Pacific railway. It required a lot of work and ability and energy for two men to build and put in operation 7,500 miles of road, to have about 1,500 miles where the track has been laid and not yet in operation; to have built a system of 10,000 miles, and to have done all this almost single-handed-because they had to an improvement; but the Government has refused, and now the question arises, what should the members of the Senate do? If I were a member of the House of Commons I would perhaps speak otherwise, but as a member of the Senate I have always expressed the opinion that the Senate should not intervene and defeat a Government bill except in very special circumstances, when Very great principles are at stake, and when the members of the Senate are conscious trimental to the interests of the country. that the acceptance of a Bill would be deIn all other circumstances I consider it the duty of the Senate to vote for Government measures. Hon. Mr. CLORAN.-Hear, hear. Hon. Mr. DAVID.-Now the first proposition is that we cannot amend the Bill be cause it is a money Bill. There was only The hon. gentleman put it in in a few one way to amend that Bill; it was through the amendments or suggestions contained in the amendments proposed by the hon. leader of the opposition, in order to try to induce the Government to accept those amendments. That was the only constitutional and legal way to have our ideas inserted in the Bill, but as I have said the Government refused. Now what should we do? There is only one course left to us, either to adopt the Bill or reject it. Well, must the Senate take the responsibility of rejecting such a bill? Hon. Mr. CLORAN.-Postpone it. Hon. Mr. DAVID.-Be quiet, if you please; you speak long enough and often enough to give a chance to another man I say that the Senate should not reject the Bill. Why? Because it has been affirmed by the leaders of both parties, by the leaders of the House of Commons, by the hon. leader of this House, that it was necessary to give aid to the company in order to avoid very serious financial consequences. Well, in view of that declaration made by the leaders of both parties, and by the leader of this House I say that the Senate would not be justified in rejecting a Bill which may entail such consequences. It has been recognized that in view of the financial conditions of the country the rejection of the Bill might aggravate seriously that condition, and affect the credit of the country. The rejection of the Bill will do no good and must do a great deal of harm. There is no doubt on those propositions. Hon. Mr. CASGRAIN.-Yes, there is. Hon. Mr. DAVID.--The Senate cannot take that responsibility without rendering itself liable to just criticism. There is no serious reason to induce it to take such a dangerous position. I shall sum ur everything I could say in a very few words and this is my conclusion to which I cal' the attention of my hon. colleagues; although the Bill is not what it should be, it is better to accept it than it is to reject it. The consequences of rejecting the Bill will be worse than the consequences of passing it. Of the two evils I chose the one which is less dangerous to the country and to the Senate. Hon. Mr. BOSTOCK.-The hon. leader of the government last night gave us the answer of the government to the motion that was made in this house, pointing out the objections that were found to this measure. But words. He practically said that the government had considered these questions before and did not see their way to altering the agreement. He made a great point of the government having taken stock in this company, and thought that by so doing they had made provision for the benefit of the country in the future, as the country would share in the prosperity of this road. The interests of the country and of this road are tied up very closely, and if the road is a success, and this agreement is a success, the country will be benefited to that extent, and we shall not be cal'ed upon to make good the guarantees for which we are now asked to stand. the point was made in the first paragraph of this motion, that it is a very dangerous thing to tie the country up with the company in a minority holding and as a partner in the concern. The hon. gentleman laid down the principle that it would have been better, in the past, if the former government had made some arrangement of this kind, in what he was pleased to call utility companies-I presume for developing the industries of this country. It seems to me that is a very serious and grave policy to enunciate; and I do not know where an arrangement of that kind would stop. If we are to take stock in companies that are, as the hon. gentlemen terms them, utility companies, we can go on from one thing to another and would practically put ourselves in position of the country being closely interested in all the large enterprises of this country. That would be a very dangerous policy for any government to pursue. The government cannot be too careful about keeping the interests of the country and the interests of corporations or individuals in this way, distinct and separate, so that the country may know where the interests of the country lie, and where the interests of a company or corporation lie. Hon. Mr. LOUGHEED.-Did the imperial government ever regret the purchase of its shares in the Suez canal? Hon. Mr. BOSTOCK.-That has nothing to do with this question, because the whole situation was so exceedingly different. The principle involved in taking stock in the Suez Canal Company, was that the government of England at that time wanted to obtain an interest in that canal, which had a very great bearing on the shipping industry of Great Britain. Hon. Mr. LOUGHEED.-This likewise is in the transportation interests of Canada. under construction and put the whole system into a position that it can earn a return on the money already invested. The hon. gentleman in his remarks last night stated that he considered the Government in dealing with this matter, had been much more solicitous for the interests of the country in rying to make a good bargain, and to get the best terms that they can for the country in this arrangement than hon. gentlemen who have criticised this arrangement. That is very largely a matter of opinion. The Government should have made the very best arrangements that possibly could have been made. They had the information, as the hon. gentleman stated. They had at least two months to go into this question and examine it from all points of view. They had the opportunity of sending their officers to examine into the whole position of the company and to find out exactly the condition of the road, and therefore they ought to have been in a position to have made the very best bargain that could possibly be made under the circumstances. Therefore from my own point of view the only thing we can do at the present time, inasmuch as the Government has announced to this House that they do not see their way to meeting the views expresesd by hon. gentlemen in this House, and amending this agreement along the lines suggested, is to allow the Government to proceed and carry out this arrangement and in that way accept the responsibility of their action. Personally I do not like the arrangement that has been made, but I consider the Senate would not be justified in interfering to such an extent with the policy of the Government of the day, as to throw out a measure of this kind and bring about a condition of things which might be very serious throughout the length and breadth of this country. Hon. Mr. BOSTOCK-Personally I do not see the connection between the two, because had Great Britain kept out of the Suez canal they would not have had the interest of handling the affairs of that canal in the way they have, and it might have had a great effect on the shipping of Great Britain, and the route connecting British ports with the ports of India. I do not think that those two are parallel cases. The Government dealing with this class of transportation in this country, should keep clear from tieing up the country in an interest in a transportation company, in the way they have done. I do not know that I need take up the time of the House by going over all the words of the agreement. The question has been so thoroughly discussed, and the points have been so clearly made that not only this House but the country generally must be fully seized of the whole situation as it stands at the present time. The hon. gentleman referred to the question of the securities, and he took I think exception to the item regarding the guaranteed securities exceeding $220,000, the land and other securities that this company had received. We have to bear in mind that in taking up this question of the guaranteed securities, we have to take into account not only the present time, but also the securities that these people can call upon the various governments to issue to them, as time goes on, and they further complete their work. There is quite a point for the government to very carefully consider in dealing with this matter, to what extent they are going to allow the lines which have been projected, on which so far no work has been done to be completed and how far they are going to allow this company to go on and complete or construct these lines until they see how this whole main line is going to work out. Hon. Mr. CLORAN-What puzzles meThe difficulty at the present time that I see and I think what puzzles the vast majority ahead of this arrangement, is very largely of the electors of this country-is the fact the fact that the earnings of the railways in that the Senate of Canada no longer than Canada to-day are decreasing instead of in- three or four days ago, put itself on record creasing, we find that the more railway lines by a vote of 34 to 22, that this bargain we build, the worse it is for the country. I between the present administration of Canwould suggest to the Government that inada and Mackenzie and Mann was practichandling this matter they ought to very carefully look into that whole question, and see that they do not allow any more railways to be commenced at the present time, until they have satisfied themselves that those lines are really required. The object, as I understand it is that this agreement is simply to complete the lines that are already ally a corrupt bargain and an unwise one, that Mackenzie and Mann were unfit persons to associate with in business transactions. That is a part of the plain language of the resolution moved by the leader of the opposition three or four days ago and carried by 34 to 22. Is that not enough to puzzle one-how three days ago they put Ottawa, and the next day 'La Presse' with themselves upon record-and these resolu- | friends of the Liberal party, had to resign. tions were not the product of imagination One went to Europe and the other came to or want of thought; they were drafted and redrafted, considered and reconsidered by the Liberal party in this House, and now, what do we find? We find certain Liberals dropping off, going over to the men they did not want to associate themselves with, or have the Government associate themselves with. What is the meaning of it all? The country is asking itself this question, and is puzzling over the situation. Where is the Liberal party going to? Have we lost our heads? Have we no direction to give to the people in this country in regard to the matter? Are we to allow the Government of the day to dictate terms to this House, without any criticism and without the right of opposing it. I was surprised and much puzzled to hear the Senator from Mille Hles give his adhesion to this Bill on behalf of Mackenzie and Mann. The hon. senator from Mille Iles is one of those who ought not to forget one episode in the political life of this country. There are some others, younger, who might not have known it, and probably if they did know it have forgotten it. Mackenzie and Mann in 1904, when Sir Wilfrid Laurier was at the height of his power and fame undertook to create a crisis in this country and a panic. They almost succeeded at the time. It was about this time ten years ago, during the general election of 1904, that these two men left their little offices and came down to the streets of Montreal and started the cam-called upon to assist by the present legislapaign on behalf of the Tory party. And tion, men who drove the knife up to the hilt how did they start it? They started it with into the heart of the Liberal party with puban expenditure of one million one hundred lic money. What will they do when they thousand, right on the street. Where did get hold of $45,000,000? How much will go they get that money? They got it out of into the next contest-this fall or next year? the public money voted to them by this I am not going to say that Mackenzie & Parliament, by provincial legislation, and Mann will come to Mr. White or Mr. Rogers by municipalities in the Dominion of Can- or Mr. Borden and hand them a cheque for ada. They went down with one million a million or two but their organizers and one hundred thousand dollars and as the engineers are in every part of the country, first blow in the campaign they brought and ten per cent. of that $45,000,000 will the strongest Liberal organ we had in the largely go to defeat the Liberal party. They Dominion of Canada, with a circulation of would be fools if they did not do it, they over one hundred thousand, a paper conwould be worse, they would be ungrateful. trolling the entire French vote in Quebec. The Government knows it, the party knows They went to the Hon. Mr. Virtue and said: it, the party is counting on that support, 'Here we want an organ to fight the Tory and that is why I cannot understand how battle in the campaign; how much do you our old-time Liberals, like the hon. Senator want for your paper?' Virtue was a lucky from Mille Iles (Mr. David) can have the man. He had two princes of finance to deal wool pulled over their eyes and ask Parliawith. He did not ask them for coppers. ment to vote these two gallant knights $45,He asked for his newspaper, eleven hundred | 000,000 of which a good portion will be taken thousand, and he got the cheque. Then the to cut our throats in the next campaign. editors of these papers, who were staunch That is what puzzles me, and is puzzling the These men |