The National Dream: The Great Railway, 1871-1881 (53 page)

Stephen would have been delighted with his own historical anonymity for he was a man who shunned the limelight. Four separate biographies of Donald Smith were published within a few years of his death. Stephen was dead for forty-four years before he was so enshrined and then the work was necessarily incomplete. The biographies that appeared of Van Horne, Smith, Hill and the others provoked in him an amused contempt. He saw to it that his own personal papers were destroyed. He had no use for scribblers. He thought the newspapers printed a lot of damned nonsense. In his later years he banned the newly invented telephone from his home; it would be used, he said, for no better purpose than to spread trivialities and gossip.

Outwardly reserved, publicly reticent and privately unassuming, he was inwardly subjected to the tugs and pressures of a mercurial psyche, reckless in its enthusiasms, magnificent in its audacities, faithful in its loyalties, consuming in its antipathies and single-minded to the point of intolerance. He was used to the blunt directives of the business world and was maddened by the circumlocutions of the political. Unlike Macdonald, to whom he poured out his inner soul in an astonishing series of personal letters (the only real record we have of that hidden turbulence), he indulged himself in the luxury of maintaining his animosities. As far as Stephen was concerned, you were either for him or against him. There was rarely a middle ground.

This apparently conservative business figure with the courtly manner could operate with a gambler’s daring when the occasion demanded it. His sudden espousal of Hill’s scheme to capture the St. Paul railroad is the first major example of it; but there were hints in his background. The story goes that when he was nineteen and looking for a job in Glasgow (he had been a draper’s apprentice in Aberdeen) he happened past the Mansion House and was attracted by a large crowd outside; some dignitary was being accorded a civic welcome. On a sudden mischievous impulse, the brash young man
moved into the ranks of the reception committee and gravely shook hands with the pear-shaped guest. It was, he discovered later, none other than Louis Philippe, the recently abdicated King of France.

The same audacity provided him with a business coup early in his career in the drapery business. As a junior partner and buyer for a Montreal firm he came under the influence, during his trips to England, of James Morrison, the most romantic business figure in the country – a man whose swift and daring rise to fortune had inspired the phrase “Morrison’s Millions.” Morrison had got his start as a result of an impetuous incident: as a draper’s apprentice he had been so struck by the beauty of a young woman in his master’s home that, on a sudden impulse, he flung his arms around her and kissed her. He thought her a maidservant; she turned out to be the master’s daughter. He married her and assured himself of a career in the business. The story has all the aspects of a cheap Victorian novel but it convinced Morrison of the value of making instant decisions. By moving swiftly and operating on the principle of “small profits, quick returns,” Morrison became a millionaire.

With England on the verge of war in the Crimea, Morrison urged Stephen to buy up all the cottons and woollens he could lay his hands on and ship them across the Atlantic to Canada before wartime scarcity shot the price up. Since Stephen had no way of consulting his superiors back in Montreal, there being no Atlantic cable, he took the plunge himself. The gamble must have dismayed his senior partner, who from time to time entered into young Stephen’s financial adventures with the comment: “Well, it is clear George is going to ruin the firm, so it might as well come now as at a later time.” But, of course, he did not ruin the firm. The corner he secured on cotton and woollen goods allowed him to bring off a financial coup. He eventually took over the firm, later formed one of his own, and soon found himself a member of the Montreal business establishment.

In Smith and Hill, Stephen found men like himself: shrewd in business, willing to take long risks, and, perhaps above all, wedded to the idea that a man was placed on earth to work, day and night if need be. To them, idleness was anathema and the concept of leisure almost unknown. Hill had never known an idle moment. Of Smith, it was said (by an old Hudson’s Bay factor) that he “was a wonder to work. He did not seem to take any sleep. We used to say, indeed, that he stopped up all night. No matter how late at night you looked, you would see his lamp burning in his house.…” Work, indeed, was
Smith’s real religion. There is a revealing story about Smith and his secretary, a God-fearing man who refused to work on Sunday in spite of a pile of correspondence waiting for the Monday post. Smith allowed him the Lord’s Day off and then, at exactly one minute after midnight, put him to work until dawn answering the mail.

As for Stephen, late in his career when he was presented with the freedom of Aberdeen, he ventured to reveal what he considered to be the secret of his rapid rise in the business world:

“Any success I may have had in life is due in great measure to the somewhat Spartan training I received during my Aberdeen apprenticeship, in which I entered as a boy of 15. To that training, coupled with the fact that I seemed to have been born utterly without the faculty of doing more than one thing at a time is due that I am here before you today. I had but few wants and no distractions to draw me away from the work I had in hand. It was impressed upon me from my earliest years by one of the best mothers that ever lived that I must aim at being a thorough master of the work by which I had to get my living; and to be that I must concentrate my whole energies on my work, whatever that might be, to the exclusion of every other thing. I soon discovered that if I ever accomplished anything in life it would be by pursuing my object with a persistent determination to attain it. I had neither the training nor the talents to accomplish anything without hard work, and fortunately I knew it.”

It was this hard ethic, so forcefully expressed by Stephen, that explains the dominance of the Scot in pioneer Canada. The Irish could loll in the taverns, sing, brawl, engage at ward level in the game of politics and otherwise disport themselves with the religious bickering that so engrossed their time and energies. For the Scots it was work, save and study; study, save and work. The Irish outnumbered them, as they did the English, but the Scots ran the country. Though they formed only one-fifteenth of the population they controlled the fur trade, the great banking and financial houses, the major educational institutions and, to a considerable degree, the government. The
CPR
was built to a large extent by Irish navvies and Irish contractors; but it was the Scots who held the top jobs. Almost every member of the original
CPR
Syndicate was a self-made Scot. In the drama of the railway it is the Scottish names that stand out: Macdonald and Mackenzie, Allan and Macpherson, Fleming and
Grant, Stephen, Smith, Kennedy, McIntyre, Angus and Hill (who was half Scottish) – living embodiments of the popular copybook maxims of the time.
Waste not, want not … Satan finds more mischief still for idle hands to do … God helps those that help themselves … A penny saved is a penny earned … Remember that time is money … Early to bed, early to rise … Keep your nose to the grindstone … See a pin and pick it up…
. Stephen, it is said, got a job through following the last of these maxims. Unsuccessful in Glasgow, he had moved to London and sought work in a draper’s establishment. The store was in chaos, for it was stock-taking day and no one had time to speak to him. He turned away disappointed and was halfway through the door when he stopped to pick up a pin, which he carefully stuck behind his coat lapel. The foreman, so the story goes, spotted the action, called him over and gave him a job on the spot. Alger could not have improved upon the incident.

Stephen’s idea of a spare-time activity was to make a study of banking. The hobby, if one could call it that, led him eventually to the top of the financial pyramid. His only real form of relaxation was salmon fishing, a passion which he indulged at his summer retreat of Causapscal on the Matapedia River in the Gaspé. His love of the sport almost certainly went back to his days at the parish school in his native Banffshire, a name Stephen was to make famous as Canada’s best-known Rocky Mountain resort. Here, as a young student, he came under the influence of a brilliant teacher and mathematician, John Macpherson. Top students were rewarded by Macpherson with an invitation to go salmon fishing. Stephen was certainly a top student in Macpherson’s specialty; the schoolmaster was to recall that in thirty years of teaching Stephen was one of the three best mathematicians he had known. The salmon-fishing expeditions must have been frequent.

A mathematician must think logically and tidily; above all, he must reason creatively. Stephen had that kind of a mind, able to grapple with intricate problems, to rearrange the components into a rational pattern and then make deductions from the result. He has been called with truth “the greatest genius in the whole history of Canadian finance.” His entire career is a testimony to it.

Stephen met his cousin Donald A. Smith for the first time in 1866 and it was a curiously chilly and awkward encounter. At this point the contrast between the two men was marked. Stephen had been in Montreal sixteen years and had climbed swiftly up the social and
mercantile ladder: a prominent man in the woollen business, a member of the Montreal Board of Trade, who mixed easily on the boards of charitable organizations with the Redpaths, the Torrances and the Allans. Smith, who was eleven years older than his cousin, had been walled off from the world in the dark and lonely corners of Labrador for more than a generation. The sophisticated Stephen was faultlessly groomed, as a good draper should be; indeed, for a time he employed a valet. Smith was shaggy and weatherworn, his sandy hair curling around his collar, his eyebrows unkempt, his beard ragged.

Smith was visiting Lachine at the time, staying at the home of his in-laws, the Hardistys. He knew very little about Stephen save that he was in the woollen trade and was a first cousin, but he decided to go into Montreal to look him up during the course of a shopping expedition. He took along his wife and family and, en route, they purchased a great, gaudy carpetbag to take back with them to Labrador; it was the sort of thing the Indians enjoyed seeing. Later, when Smith was asked if Stephen had been glad to see him, his wife burst out: “He wasn’t glad at all. Why should Mr. Stephen be glad to see country cousins like us? I wish he had waited until he met Mr. Stephen before buying that red carpet bag. But he wouldn’t let me carry it, and the rest of us waited outside.”

It is an oddly memorable picture, this initial meeting between two men who came to be numbered among the most powerful in the country: the nervous family group on the doorstep, waiting outside like poor relations and the rustic Smith, clutching his outlandishly brilliant bag in the presence of the elegant Stephen – the country mouse and the city mouse, circling each other warily.

But Smith was no bumpkin as Stephen was speedily to realize. He was a man of parts, who had earned the praise of a future Smithsonian director with his scientific experiments in farming at Esquimaux Bay where, in subarctic conditions, he had managed to raise sheep and cattle and cultivate seven acres of land. His active correspondence with colleagues all over the world kept him abreast if not ahead of international affairs. More, he was an astonishing businessman. For many years his fellow officers in the fur trade had entrusted him with their salaries and this gave him control of large sums of money. He guaranteed the fur traders three per cent a year and invested their money in securities. He was, in short, a kind of one-man Labrador bank and this became the basis of his fortune. One of the stocks he bought was that of the Bank of Montreal; another, the Hudson’s Bay Company. He ended up as one of the bank’s largest shareholders and in total control of the Hudson’s Bay Company. But, true to the copybook maxims, he was not above counting and sorting all the nails in the packing cases that were shipped to him.

When Smith met Stephen and Hill in Montreal in the spring of 1877, he was already a director of the bank. Stephen was its president. The two had become associated since that frosty meeting ten years before. Smith was moved permanently to Montreal in 1868 and he and his cousin soon found themselves co-directors and leading shareholders in several industries, including one that manufactured railway rolling stock. Bit by bit Stephen found himself getting involved with railways, almost by osmosis. As early as 1871 he and Smith had both been allied in a small way in an attempt to get a charter for a railway from the Red River to the border and another from the lakehead to Fort Garry. Macdonald’s plans for the
CPR
frustrated this project but it was almost impossible for any businessman of stature not to be connected with railways. Stephen moved into a locomotive works in Kingston, arranged for the sale of bonds on the Toronto, Grey and Bruce line, and was appointed to the provisional board of a Quebec railway. Now, in 1877, he found himself leaning across the table while a one-eyed ex-Canadian jabbed his finger at him and talked about launching a daring financial adventure.

Stephen’s precise mathematician’s mind easily grasped Hill’s Niagara of statistics and sorted them into a pattern. His gambler’s instincts tugged at him insistently. If the coup could be pulled off – it was an immense “if” – it would be a master-stroke comparable to the exploits of a Gould, a Fisk or a Morgan. If it failed, it would literally beggar them all.

What did Stephen have to gain at this point in his career? He was president of the most important financial institution in Canada, director of innumerable companies, respected by his peers, socially impeccable. The preposterous scheme of buying into an obscure and rundown railroad somewhere off beyond the mists of the horizon could, unless it worked, bring him nothing but discredit. Perhaps if he could have seen the tortured succession of events that this would finally lead to, the terrible moments when he saw his world, everything that he had built and toiled for, crumbling around him, the sleepless nights when he was close to a nervous and physical breakdown, perhaps even to suicide – George Stephen might have
hesitated and backed away. A decade later, after it was all over and the years hung heavy upon him, he gave more than a little indication of this when, on the eve of his birthday, he wrote to John A. Macdonald :