These conditions continued until the confederation of the British North American Colonies in 1867. The control of the Post Office was within the powers assigned to the new Dominion Government. The Government was desirous of not falling behind other countries in the provision of Post Office services, and it was necessary for political reasons to take advantage of every available means for facilitating intercommunication between the different parts of the Dominion. Shortly after confederation, therefore, a Bill to establish and regulate a Federal Dominion Post Office was brought before the Dominion Parliament. A reduction of the letter rate of postage from 5 cents to 3 cents per 1/2 ounce was proposed, and a rate of postage on newspapers. In some of the provinces newspapers had previously been carried by the posts free of charge; and the establishment of a rate of postage for them was to some extent bound up with the reduction of the letter rate, since with the lower rate for letters the free transmission of newspapers would have proved so great a strain on the revenue, that either the Government would have been compelled to make larger grants in aid, or services would have to be withheld in districts where it was desirable they should be provided. Some members were disposed to think the better course would have been to retain the old rate for letters and to allow newspapers to pass free, as had long been the practice in the Lower Provinces; and the imposition of a rate on newspapers was characterized as a tax on the dissemination of public intelligence and a retrogressive step towards old and exploded abuses.[127] Other members desired to follow the English example and reduce the letter rate to 2 cents, the equivalent of a penny; but this was deemed impracticable on account of the different conditions under which the Post Office was conducted in Canada, where the mails were carried very long distances through a sparse population.[128] In the United States, where the circumstances were more nearly comparable, the rate was still 3 cents. With a rate of 3 cents in Canada, as proposed, it was anticipated that there would be a considerable deficit, but that the deficit would soon disappear.[129] It was alleged that there was no demand for a reduction and that everybody was willing to pay 5 cents; but the real objection was not to a reduction in the letter rate _per se_. The objection arose from the assumption, fairly well grounded, that the reduction was only possible if accompanied by the establishment of a postage on newspapers, to which a number of members were strongly opposed. The rate of 3 cents for 1/2-ounce letters was, however, adopted. In three years the yield of postage at 3 cents surpassed the former yield at 5 cents.[130]