Hitherto the government of British North America had framed no definite or continuous railway policy. There had been general agreement that railway building should be left to private enterprise. In 1832, when the charter of the Champlain and St Lawrence was under discussion in the legislature of Lower Canada, some members advocated government ownership, but Papineau, the French-Canadian leader, protested against the jobbery that would follow. In the forties the government of Canada was selling its highways to toll-companies, and was not likely to embark on railway construction. In several later charters provision was made for state purchase, after a term of years, at cost plus twenty or twenty-five per cent. Control of private companies in the interest of the shipper was sometimes sought. In the charter of the Champlain and St Lawrence a maximum rate was prescribed {50} at 3d. a mile for passengers and 9 3/4d. a mile per ton of freight, subject to reduction when profits exceeded twelve per cent. In Upper Canada the earlier charters set no maximum, though the governor in council was given power to approve rates. It appeared to be held that different forwarding companies would make use of the iron way, and afford sufficient competition to protect shippers and passengers against extortion. New Brunswick in 1836 revealed the not modest expectations of profit which prevailed. It provided, in the St Andrews and Quebec charter, that after ten years tolls, if excessive, might be reduced to yield only twenty-five per cent profit. The same sanguine expectations were reflected in the provision made in eight charters issued by Lower Canada between 1845 and 1850, that half the profits over a minimum varying from ten to twenty-four per cent were to go to the state. The prevalent belief in the great profits to be obtained influenced public opinion against any grant of government aid, except during a brief period before the Rebellion of 1837, when the lavish policy of state construction and state bonuses adopted by the neighbouring republic proved contagious in Upper Canada. {51} Under the influence of that example the Cobourg Railroad was to be granted a loan of L10,000 as soon as an equal sum was privately subscribed and one-third was paid up. The Toronto and Lake Huron was promised L3 for every L1 of private capital expended, up to L100,000, while the London and Gore was offered a loan of twice that sum; in both these cases the loan was to be secured not only by a lien on the road, but by the liability of the communities benefited to a special tax. None of these generous offers was taken up, and they were not renewed. But a growing realization of the importance of railways and of the evident difficulty of building them in Canada solely by private funds compelled the formation of a new policy of state assistance. This new policy ushered in the first great period of railway construction. {52} CHAPTER V THE GRAND TRUNK ERA