The sun., 1918-09-17
CANADA TAKES OVER
NORTHERN RAILWAY
S10,120,000 Paid by Dominion
Government for 100000
Shares Of Stock.
D. B. HANNA TO BE HEAD
New Board Of Directors to Be
Chosen From the Various
Territories.
Special DespdfcA. TO THl suS.

Special DespdfcA. TO THl suS.
TORONTO, Canada, Sept 16,-The Ca
madam Treasury has just completed the
arrangements for the payment Of the
purchase money for Canadian Northern
Railroad stock held by Sir william Mac
kenIie. Sir Donald Mann and their asso-
ciates and for the formal incorporation
Of the railway properties in the Govern
ment system. The financial arrange
ments provide for the payment of 3d.
100000 to the two parties mentioned and
the Canadian Bank Of Commerce holders
and pledges Of $4,000 shares Of Ca
madam Northern Railroad stock taken
over from them by the Government. SUM-
dry other holders having 10000 shares
received S1,620,0o0. 81 the total amount
paid for 100000 shares 10 $10,120,o 900.
At the same time the board Of directors
Is reconstructed. All the old directors.
with the exception Of d. B. Hanna, A. j.
Mitchell and G. A. Bell. have retired.
and these three officials, who constitute
a quorum, are to carry on the opera
is appointed. 1t 10 intimated that Mr..
Hanna will be retained, probably as OPP
Grating head Of the Government system,
and that perhaps the other two men also
will keep their seats.
The board Of directors will carry on
the operations not only OF the Canadian
Northern system but also OF the Ma
tional Transcontinental and the Inter-
colonial. Hon. DR.. Reid. Minister Of
Railways and Canals. intimated that an
order in council would be put through
Immediately Incorporating the railways
referred to. with their various branches.
into one system from coast to coast So
far as capital expenditures are concerned
authority must be procured from the
Government In connection with the pur-
chase Of new equipment. acquisition of
new mileage and other proposed capital
outlay. The directors are required to
submit their recommendations to the
Governor in Council through the Min
lister OF Railways.
Keeping Politics Out.
The public is naturally much inter-
ested in the measures that are to be
taken to keep the operation and admin
istratlon Of the system free from i'm
proper political interference. Hon. DR..
Reid endeavored to reassure them on
this point by referring to the unanimity
existing in the present cabinet-con-
sentative and liberal statesmen acting
together In the selection OF the directors
and In controlling the capital expendi-
lures. Apparently 1t II the intention
Of the Government to give every part
Of the country representation on the
board. One would think that strictly
speaking this representation should be
based to some extent on the population.
wealth and amount Of Dominion taxes
paid directly and indirectly by the sew
eral provinces n the Government sys-
tenn Is to be run at a loss (allowing
for interest ON capital investment) then
the sections of the country which con-
tribute most toward making UP the de-
hcit should have a proportionately larger
voice in the control and direction. It
Is not, however, certain that this pol
icy will be followed in selecting the
representatives for the board.
Another point that comes up here re-
lates TO the attitude of the directors.
They are to be selected by territories or
sections. Thus, Alberta will have GER
tain representation on the board; Sas-
katchewan likewise and % on through
the list Of provinces. The question is
will the Alberta director consider 1t to
be his duty to promote the interests of
lbs particular province even at the ex-
pense Of the railway system on the board
Of which he sits? Conceivably the de-
sire of the several directors to further
the interests of their respective sections
Of the country might in some cases op-
crate against the successful and
proper working of the railway system.
Again, while the appointment Of par
tsan directors appears to be guarded
against while the present Union Gov
eminent is in power. the assurance
against such political control will not be
20 strong when party warfare Is again
resumed. Then a liberal Government
al Ottawa might be tempted to appoint
liberal directors. while a conservative
Government might take steps to see
that conservative directors were APP
pointed. Should the administration so
degenerate 1t would not be favorable
development for the railway system.
A Further Extension.
Those who wish to see the Govern
nent system or railways further ex-
tended so as to include the Canadian
Pacific and the Grand Trunk are con-
tnuing their agitation. but their propa-
ganda apparently is not producing 30
much impression as formerly. The busi-
consider that in the acquisition of the
canadian Northern a long step has been
taken, and the disposition Is to wait and
See what measure OF success attends this
important departure before committing
tAe country further in the direction of.
naturalization. There Is no doubt that
some powerful organizations OF shippers
actively supported the agitation for
Government ownership of railways in
me belief that II the Government owned
the roads It would be easier to keep
freight rates down than II the roads
were in private hands. The rapidity
with which the United States Govern
ment put up the rates upon taking over
the railways killed some of the enthu-
sasm for nationalizatio ton. both In the
United States and Canada. And the ef-
rect was not lessened when the Cana
oan Government followed the American
example. Then all people Of intelligence
are greatly hE6ressed with the efficiency
OF the management OF the Canadian Pa
enc IN peace and war and they think 1t
would be folly to hand that great sys-
ZEN over TO the Government. 1t Is quite
within the possibilities that develop
Ments OF the next year or two win be
sIch as to cause q decided change of
PUBLIC sentiment as regards the benefits
ot railway naturalization.