Canada - What Panama Means
( Originally Published 1915 )
IT now becomes apparent why British Columbia was described as the province where East meets West and works out Destiny.
On the other side of the Pacific lies Japan come to the manhood of nationality, demanding recognition as the equal of the white race and room to expand. Be-hind Japan lies China, an awakened giant, potent for good or ill, of half a billion people, whose commerce under a few years of modern science and mechanics is bound to equal the commerce of half Europe. It may in a decade bring to the ports that have hitherto been the back doors of America an aggregate yearly traffic exceeding the four billion dollars' worth that yearly leave Atlantic ports for Europe. Canada is now the shortest route to "Cathay"; the railroads across Canada offer shorter route from China to Europe than Suez or Horn, by from two to ten thousand miles. Then there is India, another awakened giant, potent for good or ill, of three hundred million people—two hundred to the square mile clamoring for recognition as British subjects, clamoring for room to expand.
The question is sometimes asked by Americans : Why does Canada concern herself about foreign problems and dangers? Why does she not rest secure un-der the aegis of the Monroe Doctrine, which forever forfends foreign conquest of America by an alien power? And Canada answers—because the Monroe Doctrine is not worth the ink in which it was penned without the bayonet to enforce the pen. Belgium's neutrality did not protect her. The peace that is not a victory is only an armed truce—a let-live by some other nation's permission. Without power to enforce the Monroe Doctrine, that doctrine is to Canada but a tissue-paper rampart.
To add to the complication involving British Columbia comes the opening of Panama, turning the Pacific Ocean into a parade ground for the world's fleets both merchantmen and war. Commercially Pan-ama simply turns British Columbia into a front door, instead of a back door. What does this mean?
The Atlantic has hitherto been the Dominion's front door, and the Canadian section of the Atlantic has four harbors of first rank with an aggregate population of nearly a million. Canada has, besides, three lake harbors subsidiary to ocean traffic with an aggregate population of half a million. One may infer when the Pacific becomes a front door, that Vancouver and Victoria and Port Mann and Westminster and Prince Rupert will soon have an aggregate population of a million.
Behind the Atlantic ports, supplied by them with traffic, supplying them with traffic, is a provincial population of five millions. Behind the Pacific ports in British Columbia and Alberta, one would be justified in expecting to find--Strathcona said a hundred million people, but for this generation put it at twelve million.
Through the Atlantic ports annually come two hundred and fifty thousand or more immigrants, not counting the one hundred and fifty thousand from the United States. What if something happened to bring as many to the Pacific, as well as those now coming to the Atlantic?
Then a century of peace has a sleeping-powder effect on a nation. We forget that the guns of four nations once boomed and roared round old Quebec and down Bay of Fundy way. If the Pacific becomes a front door, the guns of the great nations may yet boom there. In fact, if Canada had not been a part of Greater Britain four or five years ago when the trouble arose over Japanese immigration, guns might easily have boomed round Vancouver long before the Pacific Coast had become a front door. Front door status entails bolt and strong bar. Front door means navy. Navy means shipbuilding plants, and the ship yards of the United States on the Atlantic support fifty thousand skilled artisans, or what would make a city of two hundred and fifty thousand people. The shipyards of England support a population equal to Boston. In the United States those ship-yards exist almost wholly by virtue of govern-ment contracts to build war vessels, and in Great Britain largely by virtue of admiralty subsidies. Though they also do an enormous amount of work on river and coastal steamers, the manager of the largest and oldest plant in the United States told me person-ally that with the high price of labor and material in America, his shipyard could not last a day without government contracts for war vessels, torpedoes, dredges, etc. Front door on the Pacific means that to Canada, and it means more; for Canada belongs to an empire that has vaster dominions to defend in Asia than in Europe.
But isn't all this stretching one's fancy a bit too far in the future? How far is too far? The Panama Canal is open for traffic, and there is not a harbor of first rank in the United States, Atlantic, Pacific, or Gulf of Mexico, that does not bank on, that is not spending millions on, the expectation of Panama changing the Pacific from a back into a front door. Either these harbors are all wrong or Canada is sound asleep as a tombstone to the progress round her. Bos ton has spent nine million dollars acquiring terminals and water front, and is now guaranteeing the bonds of steamships to the extent of twenty-five million dollars. New York has built five new piers to take care of the commerce coming—and the Federal government has spent fifty million dollars improving the approaches to her harbor. Baltimore is so sure that Panama is going to revive shore-front interests that she has reclaimed almost two hundred acres of swamp land for manufacturing sites, which she is leasing out at merely nominal figures to bring the manufacturers from inland down to the sea. In both Baltimore and Philadelphia, railroads are spending millions increasing their trackage for the traffic they expect to feed down to the coast cities for Panama steamers.
Among the Gulf ports, New Orleans has spent fifteen million dollars putting in a belt line system of railroads and docks with steel and cement sheds, purely to keep her harbor front free of corporate control. This is not out of enmity to corporations, but because the prosperity of a harbor depends on all steamers and all railroads receiving the same treat-ment. This is not possible under private and rival control. Yet more, New Orleans is putting on a line of her own civic steamships to South America. Up at St. Louis and Kansas City, they are putting on civic barge lines down the rivers to ocean front.
At Los Angeles twenty million dollars have been spent in making a harbor out of a duck pond. San Francisco and Oakland have improved docks to the extent of twenty-four million dollars. Seattle attests her expectation of what Panama is going to do on the Pacific by securing the expenditure of fifteen million dollars on her harbor for her own traffic and all the traffic she can capture from Canada ; and it may be said here that the Grand Trunk Pacific of Canada —a national road on which the Dominion is spending hundreds of millions—has the finest docks in Seattle. Portland has gone farther than any of the Pacific ports. Portland is Scotch—full of descendants of the old Scotch folk who used to serve in the Hudson's Bay Company. If there is a chance to capture world traffic, Portland is out with both hands and both feet after that flying opportunity. Portland has not only improved the entrance to the Columbia to the extent of fifteen million dollars—this was done by the Federal government—but she has had a canal cut past bad water in the Columbia, costing nearly seven millions, and has put on the big river a system of civic boats to bring the wheat down from an inland empire. There is no aim to make this river line a dividend payer. The sole object is to bring the Pacific grain trade to Portland. Portland is already a great wheat port. Will she get a share of Canada's traffic in bond to Liverpool? Candidly, she hopes to. How? By having Canadian barges bring Alberta wheat down the Columbia.
And now, what is Canada doing? Canada is doing absolutely nothing. Canada is saying, with a, little note of belligerency in her voice—What's Panama to us? Either every harbor in the United States is Panama fool-mad; either every harbor in the United States is spending money like water on fool-schemes; or Canada needs a wakening blast of dynamite neath her dreams. If Panama brings the traffic which every harbor in the United States expects, then Canada's share of that traffic will go through Seattle and Port-land. Either Canada must wake up or miss the chance that is coming.
Two American transcontinentals have not come wooing traffic in Vancouver for nothing. The Canadian Pacific is not double tracking its roadbed to the Coast for nothing. The Grand Trunk has not bought terminals in Seattle for nothing. Yet, having jockeyed for traffic in Vancouver, the two American roads have recently evinced a cooling. They are playing up interests in Seattle and marking time in Vancouver. Grand Trunk terminals in Seattle don't help Van-couver; but if Canada doesn't want the traffic from the world commerce of the seas, then Portland and Seattle do.
One recalls how a person feels who is wakened a bit sooner than suits his slumbers. He passes some crusty comments and asks some criss cross questions. The same with Canada regarding Panama. What's Pan-ama to us? How in the world can a cut through a neck of swamp and hills three thousand miles from the back of beyond, have the slightest effect on commerce in Canada? And if it has, won't it be to hurt our railroads? And if Panama does divert traffic from land to water, won't that divert a share of ship-ping away from Montreal and St. John and Halifax?
There is no use ever arguing with a cross questioner. Mr. Hill once said there was no use ever going into frenzies about the rights of the public. The public would just get exactly what was coming to it. If it worked for prosperity, it would get it. If it were not sufficiently alert to see opportunity, it certainly would not be sufficiently alert to grasp opportunity after you had pointed it out. Your opinion or mine does not count with the churlish questioner. You have to hurl,facts back so hard they waken your questioner up. Here are the facts.
How can Panama turn the Pacific Coast into a front door instead of a back door?
Almost every big steamship line of England and Germany, also a great many of the small lines from Norway and Belgium and Holland and Spain ana Italy, have announced their intention of putting on ships to go by way of Panama to the Orient and to Pacific Coast ports. Three of those lines have explicitly said that they would call at Pacific ports in Canada if there were traffic and terminals for them.
The steamers coming from the Mediterranean have announced their intention of charging for steerage only five to ten dollars more to the Pacific Coast ports than to the Atlantic ports. It costs the immigrant from sixteen to twenty-five dollars to go west from Atlantic ports. It can hardly be doubted that a great many immigrants will save fare by booking directly to Pacific ports. Of South-of-Europe immigrants, almost seven hundred thousand a year come to United States Atlantic ports, of whom two-thirds remain, one-third, owing to the rigor of winter, going back. Of those who will come to Pacific ports, they will not be driven back by the rigor of winter. They will find a region almost similar in climate to their own land and very similar in agriculture. Hitherto Canada has not made a bid for South-of-Europe immigrants, but, with Panama open, they will come whether Canada bids for them or not. They are the quickest, cheapest and most competent fruit farmers in the world. They are also the most turbulent of all European immigrants. We may like or dislike them. They are coming to Canada's shores when the war is over, coming in leaderless hordes.
The East has awakened and is moving west. The West has always been awake and is moving east. The East is sending her teas and her silks to the West, and the West is sending her wheat and her Iumber to the East. When these two currents meet, what? If two currents meet and do not blend, what? Exactly what has happened before in the world, impact, collision, struggle; and the fittest survives. This was the real reason for the building of the Panama Canal—to give the American navy command of her own shores on the Pacific. Now that Panama is built it means the war fleets of the whole world on the Pacific. Canada can no more grow into a strong nation and keep out of the world conclave assembling on the Pacific than a boy can grow into strong manhood and keep out of the rough and tumble of life, or a girl grow to efficient womanhood and play the hothouse parasite all her life. 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 pass up enough platitudes to pave the way to a universal brotherhood of heaven on earth, but in the past good intentions and platitudes 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 Japan. 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 per-mit.
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.
It is when one comes to consider Panama's influence on rail traffic that it becomes apparent the Canal 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 for-mer 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 Birming- , ham 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. Fort 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 ship-ment. 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 be-cause 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 to-day 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 quantities 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 thou, sand 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 tonew 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.
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 win-ter 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 passed 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 passed 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 Van-couver 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 shore."
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.
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 thou-sand miles by water. Get out a chart and figure out for yourself what the saving means on wheat via Pan-ama 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, canals (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 canals, the interest on cost, the maintenance, and charge that up against traffic—for it doesn't matter, though the government does maintain canals ; you pay the bill in the end—canal rates come higher than rail rates. But in Canada's use of Panama, Canada is not paying for the building of the canal ; and the Lord pays the upkeep of the canal 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 in-stead 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 illustrate what Panama means in the world of traffic today. 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 Nor-folk 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 canal opened, breaking bulk twice, ten dollars, and through the canal, 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 sparse 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 platitudes and a great deal more of good old-fashioned hard hoeing.