The St. Lawrence Question
ARTICLE EIGHT: MR. DRURY ANSWERS HIS CRITICS
“Mr. Payne has made the best possible of a bad job, but it still remains a very bad job”
HON. E. C. DRURY
MR. J. LAMBERT PAYNE is to be congratulated on the excellence of his two articles against the proposed Deeper St. Lawrence Waterway. They are well written, interesting, plausible. They use statistics at least interestingly, if not always fairly. There is a certain largeness, a certain airiness, in the manner in which the careful estimates of engineers and economists and Joint Commissions and Advisory Boards are swept aside—an airiness that grips the imagination and is almost Napoleonic in its character. I very much doubt whether anyone else in Canada could have made so powerful an argument against the project. Mr. Payne has, indeed, made the best possible of a bad job.
It still remains, however, a very bad job, as I hope to show.
First of all, let me plead guilty to a crime of which Mr. Payne does not directly accuse me, but which, several times in the course of his articles, he hints may be laid at my door. I am, so far as this question is concerned, a layman, whatever that may be. As a matter of fact, I do not know whether any one person could be anything but a layman in dealing with this vast question. It is true that experts are required—experts on constitutional and international questions, on engineering, on ships and shipping, on electrical development, on trade and commerce. But no one person could hope to qualify as an expert on all these varied phases of the question, and outside of his own special study each expert would undoubtedly be as rank a layman as I. Even Mr. Payne, however great his expert knowledge may be, is undoubtedly a layman so far as many phases of the question are concerned. And the best a layman can do is to assemble and use the opinions of experts. In this, I think, Mr. Payne and I are on common ground. And after all, this question is one for laymen to decide—laymen in International Joint Commissions, laymen in the Cabinet, laymen in Parliament, and, perhaps ultimately, laymen of both sexes in the polling-booths. With this very respectable multitude I am not ashamed to take my place. I shall, however, realizing properly my layman’s limitations, be careful to refrain from expressing my own opinion on phases which properly belong to the experts. In these cases I shall use the figures and conclusions reached by the experts, and in every case I shall be careful to give the source of my information, a thing which I fear Mr. Payne has not always done in the course of his excellent articles.
“He is Talking Rubbish”
ASIDE from the very subtle appeal to Canadian pride ■L\ with which Mr. Payne begins each of his articles, “Is Canada to be scared . . and “This is, however, an appeal to fear—a threat”; and in his very ingenious solution of the transportation problem at the close of the second article, he discusses the question under five heads:
(a) Canal traffic in general, and St. Lawrence canal traffic in particular; (b)
The effect of the deepened St. Lawrence on freight rates; íe) The demand in the United States and Canada for the improved waterway; (d) Cost; (e)
Power. I shall endeavor to answer the arguments advanced under each of these heads.
Mr. Payne quotes Professor Moulton, of Chicago University: “While canals satisfactorily served the needs of an earlier period, their day, like that of the sickle, the hand-loom and the spinning-jenny, is now forever past. Precisely as
the canal supplanted the horse in the carriage of through freight, so in turn has the railway . . . come to take the place of the canal in the field of transportation ...” Commenting on this quotation, Mr. Payne says: “I unhesitatingly endorse every syllable of that judgment. Speaking quite broadly, canals are obsolete — an anachronism in the modern concept of transportation. They only justify their cost when they connect large bodies of navigable water as in the case of the Panama. Under that dictum, our lake system from Lake Superior to Prescott is sound; but from Prescott to Montreal, it is indefensible on economic grounds.”
I, too, agree with Professor Moulton, and up to a point, with Mr. Payne. Professor Moulton was, of course, speaking of cross-country canals. England at one time, before the development of railways, was crisscrossed with these. They were built to accommodate small and shallow barges, which were propelled by being towed by horses on the banks. You may yet see them here and there through the country, now unused and useless. In the United States, too, at one time they played an important part in transport. The Erie Canal, and many other lesser canals, were of this type. They were used, not only for freight, but for passenger traffic. Charles Dickens, in his “American Notes,” has preserved
for us certain features of these canals as seen by him. These, too, except in certain cases, as the Erie and the New York State cannl, where they have been enlarged and modified, have gone forever. No sane man would think of building such canals at the present time. The modern canal is a ship canal and “connects large bodies of navigable water, as in the case of the Panama.” So far Professor Moulton, Mr. Payne and I are in exact agreement.
But when Mr. Payne attempts to apply these conclusions to the St. Lawrence canals, he is, to put it very mildly, talking rubbish. The Welland is justified because it connects the Upper Lakes with Lake Ontario, but the St. Lawrence canals, connecting the whole Great Lakes system with the sea at Montreal are “indefensible!”
This is a rather strange contention. On what is it based?
Surely not on the length of canal to be traversed. The Welland canal, which according to Mr. Payne “is sound,” is twenty-seven miles long. The total length of canalization in the improved St. Lawrence project is twentynine miles. The slight difference shown cannot surely make one project “sound” and the other unsound.
It cannot be the number of locks to be passed through. There are in the proposed Deep Waterway nine locks between Lake Superior and Lake Ontario, and nine between Lake Ontario and the sea. With the exception of this twenty-nine miles of canal, the St. Lawrence, for the 120 miles between Prescott and Montreal, presents even more favorable conditions for navigation than are found between Lake Superior and Prescott. Between Prescott and Montreal there are only twenty-six miles of “restricted channel” and sixty-five miles of river navigation, while between Lake Superior and Prescott, which Mr. Payne pronounces sound, there are fifty-two miles of “restricted channel” and 163 miles of river. Moreover, the Welland canal, as anyone with any degree of information on the question knows, is, on account of the strong cross winds prevailing in that region, the most difficult to navigate. If, as Mr. Payne says, and I agree, the improvement as far as Prescott is justified, there is no reason under the sun to think that the improvement from Prescott to Montreal is not much more justifiable. Mr. Payne was surely not well-informed when he set up his contention to the contrary. Can he have been misled by a casual glance at a map? The figures which I have just used, are found on page 320, paper No. 10, of the proceedings of the Senate Committee which a year ago made such an exhaustive enquiry into this whole question
The Traffic Question
BUT it is when Mr.
Payne attempts to show by quoting statistics that the use of the St. Lawrence canals is declining, that he shows the greatest lack of familiarity with his subject. He tells us that the tonnage passing through Canadian canals between 1908 and 1917 was 78,061,085, and that for the ensuing period, 19181927, it was 70,929,707 tons, a very considerable decrease. What he is not apparently aware of is that these figures include the tonnage passing through the Canadian lock at the Sault, and that, when the third American lock there was opened on October 21, 1914, and the fourth American lock on September 18, 1919, these locks, being larger and deeper than the Canadian lock, Continued on page 54
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drew the traffic away from it. As a matter of fact, the whole decrease in the traffic through Canadian canals was due to this cause, and this alone. These figures have no relation to the growth or otherwise of traffic on the St. Lawrence canals.
A much truer picture of the growth of traffic on the St. Lawrence and Welland canals is found in the following table compiled from Government returns. This table shows the total traffic, in tons, upbound and downbound, for the Welland and St. Lawrence canals for the years 1918-1927 inclusive:
freight carried by Canadian railways, from 1918 to 1926 inclusive. The figures for 1927 are not yet available from this source:
Year Freight Carried
1918 (June 30) ................. 127,543,689
1919 (June 30) ................. 116,699,572
1919 (Dec. 31) .................. 111,487,780
1920 (Dec. 31) .................. 127,429,154
1921 (Dec. 31) .................. 103,131,132
1922 (Dec. 31) .................. 108,530,518
1923 (Dec. 31) .................. 118,289.604
1924 (Dec. 31) .................. 106,429,355
1925 (Dec. 31) .................. 109,850,925
1926 (Dec. 31) .................. 122,476,822
Table Showing: Traffic Through St. Lawrence & Welland Canals
1918 ........ 133,692
1919 ........ 188,463
1920 ........ 200,513
1921 ........ 276,177
1922 ........* 329,268
1923 ........ 338,651
1924 ........ 395,183
1925 ........ 594,477
1926 ........ 679,758
1927 ........ 914,752
increase .. 584%
1927 . Percentage
Even more significant are the following figures, showing the growing use of Canadian canals in the transportation of manufactured goods — the “packagefreight” business as it is called. These figures are taken from the Canadian Year Book, 1927, page 690:
Payne or anyone else can claim that water-borne traffic, via the St. Lawrence canal system is losing out to the railways, is an unsolved mystery. The plain fact is that the St. Lawrence, even in its present unimproved state, involving the use of two separate and distinct types of vessel
Principal Articles Carried Through Canadian Canals During Navigation Seasons, 1925, 1926, 1927
Agricultural Implements ... Cement, Bricks and Lime ..
Iron, Pig and Bloom .......
Iron and Steel, all others . ..
Merchandise not enumerated
Mr. Payne claims that our railways are superseding our canals as carriers of freight. In view of this contention it is of interest to see what the railways have been doing during these same years, when canal traffic has been increasing so tremendously. The following figures taken from the Year Book above quoted, page 653, show the number of tons of
and the added and unnecessary cost of transshipment, is a great and growing' factor in Canadian transportation. How great a factor it will become when Upper lakers can go down to Montreal, and ocean tramps come up to the head of the Lakes, it is, of course, impossible to say with absolute certainty. That it will be many times greater than it now is, is sure.
Mr. Payne claims that the Deeper St. Lawrence River will not be any improvement on the present situation so far as better freight rates on export grain are concerned, on two grounds first, that shippers will not use the canal to any greater extent than at present; and second, that no saving can be affected by the use of larger vessels operating from Fort William to Montreal. Let us deal with these separately.
Mr. Payne takes as his text in the first part of this contention the fact that in 1927, 56.04 per cent, of Canadian wheat and 51.12 per cent of American wheat was exported, not by way of Montreal, but by way of Buffalo, and thence by rail to United States Atlantic seaboard ports. There are, he says, several reasons for this condition: first, the fear and uncertainty of the canals; second, the availability of ocean bottoms and low rates at New York; and third, insurance rates. Despite Mr. Payne’s fourteen years experience in collecting statistics in regard to the grain trade, I fear he places the emphasis in the wrong place, and even leaves out some factors.
The fear and uncertainty of the canals, of which Mr. Payne speaks, are vastly exaggerated. They are not sufficient to prevent the amazing growth in canal traffic which I have already shown. They are not sufficient to keep more and more “canalers” from being built. This year, I am informed, more than twenty new boats of this type were built in England and brought across the Atlantic by Canadian companies for use in this trade. Accidents in the canals are few and far between, are no more common, in fact, than congestions and freight tie-ups on the railways. At the present time, the locks on the canal system are so small that the canal-size vessels are built to fit them, both in length and width, almost to the inch. This, of course, increases the liability to accidents and damage. With the longer and wider locks of the New St. Lawrence—locks large enough to allow the easy handling of even the largest freighters—this danger will be very greatly minimized. The “danger” to vessels in the canals, which Mr. Payne so emphasizes and which is very real, does
not consist of the danger of wreck, or even of major damage. It consists, rather, of the danger of minor damage—propellers that come in contact with the bank, rivetheads worn off by scraping the sides of the locks, sprung plates, with consequent wetting of the cargo. These dangers and damages will also be greatly reduced when the St. Lawrence improvement is carried through, for two reasons: first, that there will then be only twenty-nine miles of canal between Prescott and Montreal, instead of forty-three miles, as at present; and second, because the new canal is to be 200 feet wide, instead of 100 feet as it now is. If, as I have already pointed out, canal traffic grows in spite of these dangers under present conditions, it will undoubtedly grow much faster with the new canals twice the width of the present, and only half as long.
Mr. Payne seems to think that the factor of time is against the use of the river and canals from Prescott to Montreal, either under the present or the improved system of canals. He says: “Mr. Drury has said, and correctly, that it takes eight or nine days for a vessel to move from Fort William to Montreal; but he does not show how the time is divided over the route. This steamer may, under normal conditions, reach the eastern end of Lake Erie in from three to three and a half days. She may even be at Prescott in four and a half days . . . but it may take her as long to make the last 119 miles of the voyage as it took her to make the preceding 1,109, or longer.”
This statement is, on the face of it, absurd. Mr. Payne asks us to believe that a vessel may go from Port Colborne to Prescott in one day, negotiating twentyseven miles of the Welland canal with nine locks, as well as 318 miles of lake, and several miles of difficult channel between Lake Ontario and Prescott; but that it will take her five days to proceed from Prescott, a distance of 119 miles, of which only forty-three miles is canal now, and which, when the proposed improvement is carried out, will have only twentynine miles of canal.
As a matter of fact, when I took the position which causes Mr. Payne such Continued on page 56
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amazement, I did know the time required for each part of the voyage, not, it is true, from personal first-hand knowledge—for I have never navigated a lake vessel any more than, I take it, Mr. Payne has—but from authentic information. My source of information, both as to time, costs, rates and savings affected, is found in the Report of the Senate Committee already referred to, paper No. 10, pages 320-331. These estimates were given in evidence, publicly, before the Committee. They were made by the engineers of the Department of Railways and Canals. They were not contradicted in any detail by any witness favorable or unfavorable to the proposal. Mr. Payne, with his intense interest in this project, and his worthy and patriotic desire to save our common country from what he regards as a supreme folly, was no doubt aware of this evidence at the time the enquiry was going on. If he was prepared to show wherein these calculations were wrong, it was his privilege as well as his duty to appear before the Committee and do so. Not having done this, he can scarcely expect the public now to accept his broad general statements, unsubstantiated by further evidence, especially when these statements are, as I have shown, inconsistent in themselves.
As a matter of fact, the real reason for the large proportion of grain which goes out by way of Buffalo and the Atlantic ports, is quite different from any given by Mr. Payne, as is well known. The Canadian crop comes on the market from the end of September on. The St. Lawrence closes below Montreal shortly after Dec. 1. During these eight or nine weeks it is impossible to get the whole crop marketed. Exporters therefore, find it desirable while they are selling as much as possible to Europe by way of Montreal, to move as much as possible of the crop by lake and rail, by way of Buffalo to the Atlantic ports, from which they can supply Europe during the winter months when the St. Lawrence is closed. It is this desire to get the wheat into “selling position,” rather than the reasons given by Mr. Payne, which dictates the movement of grain by way of Buffalo.
All these adverse factors, let us repeat, including the third and last brought forward by Mr. Payne—the cost of insurance—'have not been strong enough to prevent the traffic on the St. Lawrence making the immense growth which I have already shown, or Montreal from becoming one of the world’s greatest grain ports. With the improvement of the St. Lawrence, better docking facilities at Montreal—and good as they are now, they will be progressively improved—and a certain proportion of ocean freighters coming into the Lakes with cargoes, and available, on their outgoing trips, to carry wheat to Europe, the proportion of grain going out by this route cannot help but increase.
My figures as to saving in freight rates —not ten cents per bushel, as stated by Mr. Payne, but four and a half cents—I stand by. They are taken from the Senate Committee Report twice already referred to. They have not been successfully contradicted. I have confirmed them during the past six months, by many conversations with men familiar with both shipping and grain export.
“Letting Her Soar”
"DUT it is when Mr. Payne deals with ^ costs — not the costs of the St. Lawrence canals only, but of, apparently, canals in general—that he really appears to the best advantage. He deals with fair round numbers—no haggling over odd thousands with him. In fact, like the late Bill Nye, he would almost seem to be enjoying the sport of “turning his imagination loose, and letting her soar.” He says: “What will the proposed St.
Lawrence development cost? Nobody knows. If the Canadian proposition were
adopted, the engineers tell us it would mear an outlay of $600,000,000. But we have the best of reasons for distrusting estimates. The New Welland was to cost $55,000,000; it will actually cost $115,000,000. The Panama canal was estimated at exactly $100,000,000; the capital figures are now $425,000,000. The Chicago drainage canal was to be built for $16,000,000; the liability now stands at $80,000,000. And so on, the world over. Just as competent engineers as those who made the calculations respecting the St. Lawrence scheme, have declared that it cannot be completed for less than twice $600,000,000.” And, in another place, speaking of the OswegoAlbany ship canal: “The proposed American canal would cost two billion dollars.”
Let us examine these statements: first, those that refer to finished projects; and second, those that deal with proposed developments.
The Panama Canal, according to the estimate furnished Congress in 1902, when the work was first authorized, was to cost $144,233,000, with $40,000,000 extra, for the purchase of the canal zone—a total of $184,233,000. This is, of course, slightly greater than Mr. Payne’s $100,000,000. But this was for a canal 150 feet wide, and equipped with locks, 740 feet long, eighty-four feet wide and thirty-five feet deep. Before the work was far advanced, however, the plans were changed, to allow the canal to accommodate the largest ships of the American navy. As completed, the canal was 300 feet wide and the locks were 1,000 feet long, 110 feet wide and forty-five feet deep. The completed canal cost, not $425,000,000 but $386,910,310* and this included $40,000,000 paid to Panama for the Zone, and $10,000,000 paid to the French, leaving the cost of the canal proper $337,000,000. This is more than double the first estimate of $144,000,000, but when the change in design referred to is considered, it appears that the engineers were not so far out in their estimates.
Mr. Payne says: “The Chicago drainage canal was to be built for $16,000,000, the liability now stands at $80,000,000.” According to the published reports of the Sanitary District of Chicago, the first estimate is given at $25,700,000, and the completed cost at $33,525,000, and this, too, is explained by the design having been changed, to allow a depth of twentyfour instead of eighteen feet, and a capacity of 600,000 cubic feet per minute instead of 300,000 cubic feet as first planned. There is no discrepancy between estimates and finished work here, if additional capacity be allowed for. Moreover, the figures are slightly different from those which Mr. Payne uses.
It is, perhaps, impossible to say, as yet, just what it will cost to finish the New Welland, but Mr. Payne’s figure of $115,000,000 is probably correct. The estimate, in 1912, was $60,000,000. The expenditure up to March 31, 1928, was $76,579,031. But the conditions surrounding its construction were wholly unusual. Work was started in 1913, and then discontinued shortly after the war brölce out. In 1919, work was started up again on a cost-plus arrangement in order to provide work for returned soldiers. When the contracts were re-let later, the increased costs of labor and materials were reflected in the increased cost of the work. The Engineering News-Record Construction cost index shows construction cost in 1927 to be 103 per cent greater than in 1913. (Engineering News-Record, Vol. 99, No. 22, Page 896).
And this leads us to consider that in all these instances cited by Mr. Payne, construction, which took many years in each case, was carried on during a period of unprecedented increase in costs of all sorts. The reasons for this condition Mr. Payne, as an economist, will know. It
♦Capital cost to June 30, 1925, according to report of Governor of Canal Zone.
is not necessary to go into them here. It is enough to know that this condition obtained, and was responsible for increased cost, not only of canals, but of all sorts of works, public and private. These conditions obtain no longer. Economists tell us we are in for a period of level or even receding costs and prices. If the cases cited, under conditions prevailing during construction, could keep as close as they did to their original estimates, there is every reason to believe that estimates made now will not only not be exceeded, but will be undercut during construction.
Mr. Payne’s round two billion as the cost of the Oswego-Albany canal shrinks to $506,000,000, when brought face to face with facts. “The estimated cost is $506,000,000 for twenty-five foot depth.” (Page 97, paper No. 3, Senate Committee Report!.
Costs, Big and Little
NOW, in the light of the foregoing statements, let us consider the cost of the St. Lawrence project, which Mr. Payne says: “Just as competent engineers” —whom, however, he does not name— have computed to be “twice $600,000,000.”
^ In the first place, it is necessary, in doing this, to separate power from navigation. Power will pay its own way. Private interests stand ready to develop all the power within Quebec, the Canadian section; and the Ontario Hydro-Electric system can undoubtedly take care of more than the 1,000,000 horsepower to be developed in the International Section. Indeed, according to Mr. Payne, it is the mad scramble of power interests which is forcing the question upon us. Power development may figure in the total cost, but the power available will more than take care of its own charges. Indeed, the Advisory Board has recommended that the power be made to pay for the whole scheme. We may wipe the cost of the power development off the ledger so far as the cost of navigation, which we have been considering, is concerned. The whole question is: What is the cost to Canada of providing the improved navigation?
One of the best unofficial analyses of the cost of this project is that made by Leslie R. Thomson, M.E.I.C., a consulting engineer of Montreal, and published in the April number of the Engineering Journal, which is the official organ of the Engineering Institute of Canada. On page 213, Mr. Thomson gives the cost of the improved navigation involved in the Deeper Waterway as $355,000,000, of which $148,332,000 is in the Upper Lake and International section, and falls to the United States, and $207,433,000 is in the Welland and Cornwall-to-Montreal section. But of this $207,433,000, we will already have spent $115,000,000 on the Welland, so that the cost to Canada of improving navigation from Cornwall to Montreal, even if no better bargain can be made with the United States will be, not “twice $600,000,000,” but $91,833,000. This presents the matter in a very different light.
It is quite possible, too, that a better bargain with the United States may be made. It is notorious that the proposed division of the cost at present is inequitable, and does not represent the benefits
accruing to the respective countries from the project. The only reason for the present ratio of cost is national pride or self-respect, whichever we may call it. Canada cannot consider being subsidized by the United States; neither can we allow the United States to improve the strictly Canadian section of the river. There are, however, other ways of reaching a more equitable division of costs. It will be the duty of the Canadian Government to drive the best bargain possible, having regard to a proper national self-respect. It is quite possible that a division of costs, much more favorable to Canada than any yet considered, may be obtained.
When Mr. Payne comes to the discussion of the power phases of the question he exhibits a further lack of acquaintance with the facts that is, to me at least, rather disconcerting. He says, “Hon. Mr. Drury puts the total power at 5,000,000 horsepower, and he places Canada’s share at 4,000,000. At all events that is my understanding of what he has written. Thus far in the official discussion, however, only a fifty-fifty basis has been implied.” This, of course, is altogether wide of the facts. The power in the International Section, of course, amounting to 2,200,000 horsepower, belongs to Canada and the United States equally, and must be divided equally. The power in the Canadian section, however, amounting to 2,800,000 horsepower, belongs wholly to Canada; and neither Mr. Payne nor anyone else can point to a single sentence in the “official discussion” that questions this, or proposes to divide this on a “fifty-fifty basis.”
The true state of affairs is well stated in paragraph 394, page 255, of the Engineering Journal already referred to. “Between Prescott and Montreal, there is available 5,000,000 of installed horsepower. Of this amount, 2,800,000 lies completely within Canada, and in addition half of the International section power (2,200,000 horsepower) must be allocated to Canada. Canada’s share is therefore 3,900,000 horsepower.
“Facts Are Not Elastic”
TN MATTERS of opinion, men may well
differ, and one man’s opinion may be as good as another’s. In order to have an opinion worth considering, however, it must be founded on facts, and facts are not so elastic. They are in truth immutable. I have shown that, in the case of Mr. Payne’s contentions, the underlying basis of fact is wanting. He is mistaken in his contention regarding canal traffic. He is wide of the mark regarding costs. He is not, apparently, aware even of the division of the power between the United States and Canada. Can we believe that his opinions, founded on so much misinformation, can have any weight?
His solution of the transportation question is simply ludicrous. Does he not know that in short hauls the railways are at a distinct disadvantage, due to the cost of loading, switching and yarding? I . venture to say that he cannot get a single responsible transportation authority to back his proposal.
Mr. Payne has made a strong attack on the position taken in my articles on the St. Lawrence problem. If his contentions were founded on a sure basis of fact, they would have great weight. Not being so founded, they must, perforce, fall to the ground.