in England:
The Great Western Rail Road is designed not only to facilitate the internal traffic of the Province of Canada, for which its route possesses eminent advantages, but also to form a connective link in the great chain of Railway from the city of Boston, on the Eastern coast of the United States, to the Mississippi River, thus drawing over it an immense and increasing foreign traffic.
Prospective shareholders were assured that no other route could compete with the Great Western. Navigation on Lake Erie was hindered by winter ice for several months each year and was dangerous at all times. Competing railways south of Lake Erie would be at least 125 miles longer while there was no competing railway north of Lake Erie. (The ruinous competition with the Grand Trunk and Canada Southern Railways could hardly have been anticipated at this early date!)
On December 16, 1845, a Hamilton newspaper announced that a public dinner would be given in one week in honour of MacNab and Belle Ewert “as a testimonial of congratulation upon the successful completion of the object of their mission.” There appeared to be good reason to celebrate: of the company’s authorized capital of £1.5 million ($7.31 million U.S.) (60,000 shares), MacNab and Belle Ewart had no difficulty selling the 55,000 shares reserved for British investors to eleven London financiers, including George Hudson, the celebrated English railway “king.” The remaining 5,000 shares were reserved for Canadian investors.
Unfortunately, the British railway boom collapsed before even the small first installments (5 percent down) had been paid on many of the reserved British shares. This financial panic caused the stock of Britain’s own London and Northwestern Railway, considered very solid, to fall 50 percent (£220 to £110) within one year. In addition, it proved impossible to sell the 5,000 “Canadian” shares. The provincial government resisted MacNab’s pressure to furnish the loan of £200,000 ($975,000 U.S.) promised in 1837, nor would it agree to provide one million acres of Crown land at a low price. This land was destined for British paupers imported by the company to provide an inexpensive labour force. Another component of this scheme was the plan to call on the British government to provide a loan in return for being relieved of the burden of these paupers. It is uncertain whether the British government would have agreed to this plan, but in any event the Canadian government’s refusal to co-operate doomed the plan. The attitude of British investors at the time was summed up by civil engineer Walter Shanley:
Of the Great Western Railway I hear nothing but that English capitalists are unwilling to embark in it, not knowing how soon Canada may be a repudiating State.
The latter statement refers to the bitterness caused by the repeal of the Corn Laws, culminating in a movement by some Canadian elements in support of annexation to the U.S.
Nor were Canadian railways alone in the doldrums. John M. Forbes, in response to MacNab’s request for funds, wrote “At this moment it is impossible to get subscriptions to any Rail Road, however promising.”
In 1846 the charter of the Great Western Rail Road Company was amended to afford “a just and proper protection to the English shareholders of the company in respect of their shares.” A corresponding committee of up to eleven English members was to be created in England to serve as a protector of English shareholder rights. However, it actually also became de facto the group that made all important managerial decisions for the railway while the board of directors in Canada had to have virtually everything it did approved by the corresponding committee. Financial accounts for the company were to be maintained in England. with copies being sent to the directors in Canada. In truth, this document made Canadian shareholders and Canadian directors subordinate to English shareholders and the corresponding committee, respectively (Province of Canada Statutes, 9 Victoria, chapter 81, assent date June 9, 1846).
Despite the fact that financing the Great Western remained a problem, there were advances on other fronts. Charles B. Stuart, chief engineer of the Great Western, produced a report on September 1, 1847, which dealt with the final location of the main line and final specifications for everything from roadbed to bridges and buildings. He indicated that of the entire distance between the Suspension Bridge and Windsor of 228 miles, over 217 miles was perfectly straight. He was pleased to state that he knew of “no other case in this country or elsewhere comparable with this, and it is doubtful whether another location of the same extent can be found on the Continent, so well adapted to the attainment of high velocity, and great economy of transportation.”
Stuart felt that there was no doubt that, although it would cost £1,218,520 ($5.93 million U.S.) to build, the Great Western would prove a profitable investment for its promoters. Everywhere along the line, roadbed property was being provided free of charge while municipalities had promised sites for depots and freight sheds. However, municipalities were providing next to nothing in terms of financial support. For example, in 1845 Hamilton’s municipal council voted to provide £25 ($122 U.S.) in funds upon receiving the company’s request for aid. Using Stuart’s estimate of £4,332 ($21,100 U.S.) per mile, this £25 would finance the construction of thirty feet of track!
On October 23, 1847, the time had arrived for turning of the first sod in London, Ontario. In the words of the Globe (October 27, 1847):
Daylight broke on the eventful morning in all the splendor of an October day in Canada…. From a very early hour the streets of London gave evidence of a holiday. The shops were decked out in their best style … and innumerable wagons filled with the hardy lords of the soil, and their merry families, poured into the town.
Per Talman in 1948:
On that day, something less than ninety-nine years ago, Colonel Talbot turned the first sod which represented the beginning of construction of the Great Western. The fact that the survey was changed and that the railway did not go over the place he marked does not detract from the importance of the occasion. Talbot turned sod in a vacant lot on Richmond Street where the Hyman tannery stands today and, of course, the Great Western came through on the present line of the C.N.R. When he turned the sod, Talbot is reported to have said “I slept on this spot fifty-five years ago when my best friend was a porcupine. What a change has occurred since! Now I see different beings around me, no porcupines with bristles but in their place a company of half-civilized gentlemen.” Talbot possibly was slightly under the influence of alcohol at the time for his speech. No reporter recorded what the half-civilized bystanders thought of Talbot’s remarks.
— J.J. Talman, Western Ontario Historical Notes 6(1) (March 1948), 3
A public dinner followed, at which sixteen toasts were made.
As 1848 came to an end, there must have been many who doubted whether the dream first conceived in 1833 would ever be fulfilled. Fortunately, the fortunes of the Great Western (and several other railways in Ontario) would improve markedly in 1849. In April 1849 Francis Hincks, inspector general, introduced the Guarantee Act into the Legislature of the Province of Canada. This measure clearly stated that there was a need for government assistance to allow the construction of railways in rural areas where capital was scarce. The assistance took the form of a guarantee of interest at 6 percent on not more than 50 percent of the bonded debt of railways over seventy-five miles long, after the completion of at least one half of their mileage. Obviously, Sir Allan MacNab temporarily abandoned his role as leader of the opposition to help shepherd the bill to pass unanimously (Province of Canada Statutes, 12 Victoria, chapter 29, assent date May 30, 1849). Although the Guarantee Act could not benefit a railway until it had completed at least half of its mileage and could not benefit lines less than seventy-five miles long, it was an all-important first step in the long story of government guarantees and subsidies for Canadian railways. Its usefulness was further restricted in 1851 by Hincks’s decision to restrict the act to lines forming part of the province’s trunk system, in an attempt to help his Grand Trunk Railway (Province of Canada Statutes, 14 & 15 Victoria, chapter 73, assent date August 30, 1851). Luckily, the Great Western was considered to be the western extension of the
