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Canada and the States By Sir E. W. Watkin Characters: 19871

Updated: 2017-11-29 00:04


Negociations for Purchase of the Hudson's Bay Property.

In response to our demand for a large tract of land through the "Fertile belt" of the Hudson's Bay territory, the Governor answered, almost in terror, to the Duke of Newcastle:-"What! sequester our very tap-root! Take away the fertile lands where our buffaloes feed! Let in all kinds of people to squat and settle, and frighten away the fur- bearing animals they don't hunt and kill! Impossible. Destruction- extinction-of our time-honoured industry. If these gentlemen are so patriotic, why don't they buy us out?" To this outburst the Duke quietly replied: "What is your price?" Mr. Berens, the Governor, answered: "Well, about a million and a half."

Finding that our demands for land alongside the proposed road and telegraph were not acceptable to the Governor and Court of the Hudson's Bay Company, we had nothing for it but either to drop the Pacific transit proposal, after many months of labour and trouble, or to take the bold course of accepting the challenge of those gentlemen, and negociating for the purchase of all their property and rights. Before making a decided move, however, I had many anxious discussions with the Duke as to who the real purchaser should be. My strong, and often urged, advice was, that whoever the medium of purchase might be, Great Britain should take to the bargain. I showed that at the price named there could be no risk of loss; and I developed alternative methods of dealing with the question:-That the fur trade could be separated from the land and rights, and that a new joint stock company could be organized to take over the trading posts, the fleet of ships, the stock of goods, and the other assets, rights, and privileges affecting trade, and that such a company would probably pay a rental-redeemable over a term of years, were that needful to meet Mr. Gladstone's notions-of 3 or 3-1/2 per cent, on 800,000_l_., leaving only 700,000_l_. as the value of a territory bigger than Russia in Europe. Such a company would have to raise additional capital of its own to modernize its business, to improve the means of intercourse between its posts, and to cheapen and expedite the transport to and fro of its merchandise. I carefully described the nature of these changes and all that they involved. The Duke seemed to favour this idea. Then I pointed out that, if desired, a land company could be organized in England, Canada, and the United States, which, on a similar principle of rental and redemption, might take over the lands-leaving a reserve of probably a fourth of the whole as the, unpaid for, property of the Government-at the price of 700,000_l_. If these proposals succeeded, then all the country would have to do was to lend 1,500,000_l_. on such security as could be offered, ample, in each case, in my opinion. But I said it must be a condition, if these plans were adopted, to erect the Hudson's Bay territory into a Crown Colony, like British Columbia, and to govern it on the responsibility of the Empire. I showed that this did not involve any large sum annually; and that, as in the case of British Columbia, the loss would be turned into a profit by sales of the one-fourth of the land to be given, in return for the responsibilities, taken, to our country. Again, the cost of government might be recouped by a moderate system of duties in and out of the territory, to be agreed with Canada and British Columbia on the one hand, and the United States on the other. This, in outline, was one plan. The next was, to sell a portion of the territory to the United States at the price, which I knew could be obtained, of a million. A third plan which I suggested was, to open up portions of the "Fertile belt" to colonization from the United States. To offer homes, in a bracing, healthy country-with fertile lands and long waterways-to the multitudes of men and women in Ohio, Kentucky, Maryland, and many other States, who desired to flee from war and conflict; whose yearning was for settled government and peace. These men and women had still resources, friends, and credit, and if our country opened its arms to them, they would flock to the old red flag, and bring their energies to bear on the industrial conquest of these vast regions to the West.

But-if any man went, morally, down on his knees to another, I did to the Duke, to beg, beseech, implore,-that this great bargain, this purchase of purchases, of a Continent, should be made for our country, and should be untainted by even the suspicion of a mercantile adventure. In the end, I thought I had converted the Duke, well disposed always, to the wisdom of such a policy. Following this line, we discussed many details. He "would not sell," but he would "exchange;" and, studying the map, we put our fingers upon the Aroostook wedge, in the State of Maine-upon a piece of territory at the head of Lake Superior, and upon islands between British Columbia and Vancouver's Island-which might be the equivalent of rectification of boundary on many portions to the Westward along the 49th parallel of latitude.

Further, at one of our many interviews a name for the new Crown Colony, if established, was mentioned-"Hysperia." Dr. Mackay had suggested it to me. The general answer of the Duke was-"Were I a minister of Russia I should buy the land. It is the right thing to do for many, for all, reasons; but ministers here must subordinate their views to the Cabinet." Still, he went so far, that I believed if the Hudson's Bay property were once bought, the Duke would manage to take the purchase over for the country. I was too sanguine. I had not measured the passive resistance of the inside of the Colonial Office to everything that inside had not initiated; though the fact that day by day objections, urged to the Duke from inside, were put to me, by him, and, I believe, always satisfactorily answered, might have warned me. I hope to live to find three conditions established at the Colonial Office:- (1) That no one, from the head down to the office boy, shall enter the doors without having passed in general and in British Empire, geography. (2) That no one shall be promoted who has not visited some one British Colony or Province; and (3) That no one shall be eligible for the highest offices who has not visited and studied, personally, every portion of the distant British Empire.

With confident hope I went to work. It is true that Mr. Thomas Baring warned me. He said: "If the Duke wants these great efforts made he must make them on behalf of the Government: he must not leave private persons to take the risk of Imperial work." And, in this state of mind, Mr. Baring refused, afterwards, to be one of the promoters of the Pacific scheme, a refusal which led Mr. Glyn to hesitate to sign the legal papers without his friend and colleague. It was an anxious time for me; for on my head rested the main responsibility. One circumstance somewhat sustained me. On "the 10th December, 1862, at Thomas' Hotel, the Duke had read to me a private letter from Mr. Gladstone to him, containing these words. Words of which I was allowed to make a note" Your Pacific scheme would be one of the grandest affairs ever achieved, and I hope it will be completed in your time. It shall have my hearty support." Alas! however, Mr. Baring was right.

The first official interview with the Governor and Court of the Hudson's Bay Company was at the "Hudson's Bay House," Fenchurch Street, on the 1st December, 1862. The room was the "Court" room, dark and dirty. A faded green cloth, old chairs almost black, and a fine portrait of Prince Rupert. We met the Governor, Berens, Eden Colville, and Lyell only. On our part there were Mr. G. G. Glyn (the present Lord Wolverton), Captain Glyn (the late Admiral Henry Glyn), and Messrs. Newmarch, Benson, Blake, and myself. Mr. Berens, an old man and obstinate, bearing a name to be found in the earliest lists of Hudson's Bay shareholders, was somewhat insulting in his manner. We took it patiently. He seemed to be astounded at our assurance. "What! interfere with his Fertile belt, tap root, &c.!" Subsiding, we had a reasonable discussion, and were finally informed that they would give us land for the actual site of a road and a telegraph through their territory, but nothing more. But they would sell all they had, as we "were, no doubt, rich enough to buy," for "about" 1,500,000_l_., as they had told the Duke.

The offer of the mere site of a road and ground for telegraph poles was of no use. So, just as we were leaving, I said, "We are quite ready to consider your offer to sell; and, to expedite matters, will you allow us to see your accounts, charters, &c." They promised to consult their Court. And, gradually, it got to this, that I was put in communication with old Mr. Roberts, aged 85, their accountant, and with their solicitor, the able and honorable Mr. Maynard, of the old firm of Crowder and Maynard, Coleman Street, City.

I had many interviews; and on the 17th March, 1863, I met the Governor, Mr. Ellice, jun. (son of Edward Ellice-the "old bear"), Mr. Matheson and Mr. Maynard. They showed me a number of schedules, which they called "accounts." Next day I had a long private interview with Mr. Maynard, but "could not see the 'balance-sheet.'" The same day I saw the Duke with Messrs. Glyn and Benson. Next day (19th) I spent the forenoon with Mr. Roberts, the accountant, and his son and assistant, at the Hudson's Bay House. Mr. Roberts told me many odd things; one was that the Company had had a freehold farm on the site of the present city of San Francisco of 1,000 acres, and sold it just before the gold discoveries for 1,000_l_., because two factors quarrelled over it. I learnt a great deal of the inside of the affair, and got some glimpses of the competing "North West" Company, amalgamated by Mr. Edward Ellice, its chief mover, many years agone with

the Hudson's Bay Company. Pointing to some boxes in his private room one day, Mr. Maynard said: "There are years of Chancery in those boxes, if anyone else had them." And he more than once quoted a phrase of the "old bear": "My fortune came late in life."

On the 8th May I went to see the Duke. He was very ill; but his interest in the Hudson's Bay purchase was unabated. I saw him again on the 15th, and wrote a letter to the Hudson's Bay Company. On the 19th Mr. Maynard told me that the Hudson's Bay Court were meeting that day to reply to my letter. The reply came on the 21st, and was "nearly what we wished."

Owing to the Duke's illness, and to some secret difficulty which he never enlightened me upon, I was given to understand, after a short, but anxious delay, that any purchase must be carried out by private resources; but all sorts of moral support would be at our service. What good was moral support in providing a million and a half? What was to be done? There were only two ways: one, to make a list of fifteen persons who would each take a "line" of a hundred thousand pounds for himself and such friends as he chose to associate with him; the other, to hand the proposed purchase over to the just founded International Financial Association, who were looking out for some important project to lay before the public.

Leaving out Mr. Baring and Mr. Glyn (senr.) we had a strong body of earnest friends, substantial men, and we could, no doubt, have underwritten the amount. My proportion was got ready; and my personal friends would have doubled that proportion, or more, if I had wanted it. I strongly recommended this course. But the Hudson's Bay Company would give no credit. We must take up the shares as presented and pay for them over the counter. Thus, the latter alternative was, after some anxious days, adopted. Mr. Richard Potter was the able negociator in completing this great transaction, began and carried on as above. The shares were taken over and paid for by the International Financial Society, who issued new stock to the public to an amount which covered a large provision of new capital for extension of business by the Company, and a profit to themselves and their friends who had taken the risk of so new and onerous an engagement.

I may finish this section by stating that, as respects the new Hudson's Bay shareholders, their 20_l_. shares have been reduced by returns of capital to 13_l_., and having, nevertheless, in the "boom" of lands in the West, been sold at 37_l_. as the price of the 13_l_.; they are now about 24_l_. Thus, every one who has held his property, and will continue to hold it, has, and will have, a safe and unusually profitable investment. These shareholders, besides the large reserves near their posts, which I shall enumerate later on, have a claim to one-twentieth of the land where settlements are surveyed and made. This gives a great future to the investor. On the other hand, Canada-in place of the Mother Country, to whom the whole ought to have belonged, for the purposes previously set forth-has obtained this vast and priceless dominion for a payment of only 300,000_l_., on the award of Earl Granville; and the Pacific Railway, by reason of that great possession, has been completed and opened.

But there is much to record between the period of purchase and the sale to Canada.

I here give to the reader some letters of the Duke's relating to these negotiations generally:-

"DOWNING STREET,

"14 Augt. 1862.

"MY DEAR SIR,

"I am glad to tell you that since I received your letter of Saturday last, the Hudson's Bay Company has replied to my communication, and has promised to grant land to a company formed under such auspices as those with whom I placed them in communication. The question now is-what breadth of land they will give, for of course they propose to include the whole length of the line through their territory. A copy of the reply shall be sent to Mr. Baring, and I hope you and he will be able to bring this concession to some practical issue.

"I was quite aware of the willingness of the Company to sell their whole rights for some such sum as 1,500,000_l_. I ascertained the fact two months ago, and alluded to it in the House of Lords in my reply to a motion by Lord Donoughmore. I cannot, however, view the proposal in so favourable a light as you do. There would be no immediate or direct return to show for this large outlay, for of course the trade monopoly must cease, and the sale of land would for some time bring in little or nothing-certainly not enough to pay for the government of the country.

"I do not think Canada can, or if she can ought to, take any large share in such a payment. Some of her politicians would no doubt support the proposal with views of their own,-but it would be a serious, and for some time unremunerative, addition to their very embarrassing debt.

"I certainly should not like to sell any portion of the territory to the United States-exchange (if the territory were once acquired) would be a different thing,-but that would not help towards the liquidation of the purchase-money.

"I admire your larger views, and have some tolerably large ones in this matter of my own, but I fear purchase of this great territory is just now impracticable.

"I am, yours sincerely,

"NEWCASTLE.

"Edwd. Watkin, Esq."

This letter was written in the educational period. The doubts came from the officials of the Colonial Office. I removed them.

"Downing Street,

"17 Novr. 1862.

"My dear Mr. Watkin,

"I send you the 'route' from the Pacific to Canada, which I promised.

"I cannot vouch for it; but it comes from an unusually well-informed quarter, and I incline to think it is much nearer accuracy than such information as represents the obstacles to be almost insuperable.

"I am, yours very truly,

"NEWCASTLE."

"Memorandum of a Route from Vancouver Island to

Canada.

Stations Conveyance Time

"Victoria, Vancouver Island Yale, on Fraser River, or Douglas, on Harrison Lake Steamer 2 days Lytton, on Fraser River, or Lillovet Stage coach 2 days Alexander, on Fraser River Do. 4 days Fort George, on Fraser River Steamer 2 days Tete Jaune Cache do. Do. 5 days between 53 degrees and 54 degrees N L ---- 15 days =======

The stage road from Douglas to Lillovet is described as complete, and that from Lillovet to Alexandria as in progress, as also the machinery of a stern-wheel steamboat for the water communication between Alexandria and Tete Jaune Cache.

The last-named place [Sidenote: Tete Jaune Cache.] is situated between 53 degrees and 54 degrees N.L., and is at the western extremity of the most practicable pass of the Rocky Mountains. The distance from this to Jasper House, [Sidenote: Jasper House, between 53 degrees and 54 degrees N.L., and distant 120 miles from Tete Jaune Cache.] at the eastern extremity of the pass, is 120 miles by trail, admitting, it is said, of conversion at small cost into an easy carriage road.

The distance from Jasper House to the next post, Edmonton, [Sidenote: Edmonton, 200 miles by road from Jasper House, and 90 miles by road from Assiniboin.] on the Saskatchewan, is 200 miles by road through a level wooded country, or the Elk and Athabasca Rivers may be descended by water to Fort Assiniboin, whence to Edmonton is only 90 miles.

The road communication between Tete Jaune Cache and Edmonton is represented as the only necessary work beyond Alexandria, and may be opened for 50,000_l_.

Two courses are suggested from Edmonton to the Red River, one by water along the Saskatchewan and Lake Winnipeg, another by road from Carleton, on the Saskatchewan, through the Prairie.

No remarks are offered upon the character of the route between the Red River and Lake Superior, except that it is said to present no serious difficulties.

"13_th Nov_. 1862.

R.E."

"DOWNING STREET,

"18 Novr. 1862.

"MY DEAR SIR,

"I have had a long interview of two hours today with Mr. Berens, Mr. Colville, and Mr. Maynard; but I am sorry to find that matters have by no means progressed so far as I was led to expect.

"I think I ought now to see Mr. Baring, Mr. Glyn, and yourself as soon as possible.

"Can they and you come here on Thursday at any hour not earlier than 2.30 nor later than 4? If that will interrupt other business, I could propose 11.30 on Friday at Thomas' Hotel.

"Yours sincerely,

"NEWCASTLE."

"CLUMBER,

"7 April, 1863.

"MY DEAR SIR,

"I have received from Sir F. Rogers the draft print of your Bill, and his remarks upon it.

"I still think it quite possible to meet your views respecting the lower portion of the Athabasca territory; but the mode of doing it does not appear to me so simple or clear.

"I should much desire to consult the Land Commissioners before the matter is settled; and I do not see that the delay of ten days or a fortnight from this date could endanger the measure, for Lord Monck wrote to me by last mail that the Parliament had as yet not begun business.

"If you agree to this, I will send the papers and my remarks to the

Land Commissioners at once, and see you (after getting their report) on

Wednesday next, or any day after it, except Friday.

"Pray let me hear by return.

"Yours very sincerely,

"NEWCASTLE."

"DOWNING STREET,

"6 May, 1863.

"MY DEAR MR. WATKIN,

"I hope and believe that the despatches in their final shape, as they went out to N. Columbia on Friday last, and to Canada on Saturday, were quite what you and the proposed 'N. W. Transit Company' would wish.

"I added words which (without dictation) will be understood as implying

'No Intercolonial, no Transit.'

"If you happen to be in this neighbourhood any day between 3 and 4.30, I shall be glad to see you, though I have nothing at all pressing to say.

"Yours very sincerely,

"NEWCASTLE."

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