STEEP AND CROOKED … by Late Writer, Artist & Castle Builder Bill Laux – Chapter IX

March 8, 2017March 10, 2017 / Peter Klopp / 1 Comment

STEEP AND CROOKED: THE MINING RAILROADS OF THE CANADIAN BORDER

By Bill Laux

CHAPTER NINE

GRANBY 1895 – 1902

Granby-Smelter

Jay P. Graves at the California mine on Red Mountain had held his breath in 1895 and taken the plunge. He bought into a pair of copper prospects on Knob Hill in the Boundary range of the Monashee Mountains a few miles north of the border. An old and trusted acquaintance, H.P. Palmerston, had come to him with a proposal. Palmerston had been offered one quarter of their claims on Knob Hill by the Greenwood prospectors, Henry White and Matthew Hotter, on a promise that he would raise development money. Palmerston was ill and unable to interest anyone in these remote claims. He sold his interest in them to Jay Graves.

Graves put his Spokane boarder, Aubrey White, a bookseller, to peddling stock in these claims to Spokane mining speculators in 1896. White could get no more than 10 cents a share; on the Spokane Mining Exchange they traded for just 5 or 6 cents. This was failing to raise enough capital to begin work, so Graves sold his house and moved his family into the Spokane Hotel. With the money from this sale, he hired Henry White, the original locator, to begin to clearing the forest from the claims and digging a trench to expose the top of the ore body. When the extent of the deposit had been established by trenching the shallow overburden of soil, Graves bought a boiler, a steam powered hoist and a steam pump to begin sinking a shaft into the ore. This machinery had to be hauled by wagon from Bossburg on the SF&N line to Grand Forks. Then a road had to be brushed out up to Knob Hill on the ridge top west of town. The claims that Graves had bought did not contain the rich, narrow veins plunging steeply into the mountain, as at Rossland. The trenching had showed that the copper was a large, saucer-shaped ore body just below the surface. How thick it was, no one knew. It was only 1 or 2 percent copper, but there was a great deal of it, and it contained minor amounts of gold and silver. A pit could be opened and the ore quarried cheaply out of the hillside. Still, more development money would have to be raised to determine the full extent of the ore body.

Graves had incorporated the two claims with 1,500,000 shares for the Knob Hill and 1,000,000 shares for the Old Ironsides. In 1899 he sent out Frank Hemmenway, a Spokane bank teller who doubled as a miner in the summer, to work with Henry White, trenching and taking samples for assay. Hemmenway had a sound reputation with Spokane mining investors, and his favorable report boosted the stock price on the Spokane Exchange. It also started a rush of prospectors and promoters to the Knob Hill discoveries. All those who had been too late to cash in on the Red Mountain bonanza now swarmed over Knob Hill, and claims were staked for several miles in all directions. The trenching White and Hemmenway had done on Grave’s Knob Hill claims suggested the presence of a very large ore body, much large than the original 600 by 1500 foot claims. Graves used the money stock sales were bringing in to buy the adjoining claims and acquire the entire ore body. Encouraged by reports of other ore bodies in the district, other serious investors were moving in. In 1897 the Dominion Copper Company was formed to acquire the Idaho, Brooklyn and Stemwinder claims across the valley of Twin Creek from Graves’ developments. All of the deposits found, while large and close to the surface, were of low grade. None of them would pay for the long wagon haul to the railroad at Bossburg or Marcus.

Railroads were coming; Dan Corbin was surveying his line from Marcus to Greenwood. Fritz Heinze was surveying his route over Mc Rae Pass. The CPR was, with agonizing slowness, creeping in from Alberta. The railroads had made Rossland, and Jay Graves was confident that when one reached his mines, there would be a boom bigger than had yet been seen. A smelter would be required. To raise money for it, Graves and Aubrey White went east to enlist Montreal investors. Their pitch to the Montreallers was that it was a patriotic duty for Canadians to invest in these British Columbia mines, and not let them fall into the hands of the greedy Americans. The spectacle of a couple of Americans, Graves and White, glibly promoting Canadian patriotic sentiment was a replay of Captain Ainsworth’s arguments to the B.C. Legislature, twenty years before. Graves and White were helped by the fact that Canada was in the midst of its great Free Trade Election and the issue of American domination of Canadian business was being fought out at the polls. The anti Free Trade forces won and so did Graves. He enlisted the support of Stephen Miner, a Quebec industrialist with connections to the Montreal banking community. Miner wanted a recognized mining engineer to submit a report on Graves’ to circulate to his wealthy friends. Graves sent out another Spokane Colonel, Nelson Linsley, the head of the Spokane Mining Bureau, and a respected mining engineer, to assess the value of his claims on Knob Hill.

The report was favorable. In Montreal, Stephen Miner showed it to his friends, and introduced them to Graves who, with his tongue stuck solemnly in his cheek, warned them of the dangers of Americans getting control of this valuable Canadian resource. Might not even political annexation follow? he asked with a melodramatic shiver. Miner’s friends were impressed. The combination of patriotism plus profit was irresistible. There is something embarrassingly familiar about this to Canadians. It seems it always takes an American to arouse Canadian patriotism. With a group of wealthy Montreal investors behind him, Graves went across town to the CPR. He began lobbying the CPR directors to lay rails to his mines. The directors were skeptical. Three mountain ranges would have to be crossed, and they doubted that Grave’s low-grade copper would pay for the construction costs. Jay Graves was at an impasse. The railroad was essential to his mines. Without a firm promise of one, he and Miner could not sell stock in the Old Ironsides and Knob Hill. And until his mines demonstrated their profitability, the CPR would not move. And just as it was the threat of American control that brought the Montreal investors into Graves’ scheme, it was Dan Corbin, lobbying for a charter for a railroad to the Boundary mines, that aroused the CPR. They easily blocked his charter application in Parliament, but when Jim Hill bought Corbin’s railroad, the CPR had to act. Almost in a panic, they sent their engineers and surveyors into the Monashee snows to rush a line to the Boundary Copper camps.

The arrival of Canadian Pacific rails in Grand Forks in 1899 was marvelous luck for Jay Graves and Stephen Miner. With the CPR laying track toward their new mining camp of Phoenix, the future of their Granby Company was assured. However, Graves knew very well the CPR’s intention to create a transportation monopoly in the Boundary district, just as they had attempted in the Kootenays. And with the knowledge that only a second and competing railroad could bring the CPR ore hauling rates down to the lowest possible figure, Graves went to Jim Hill in St Paul. He showed him Colonel Linsley’s reports on the Old Ironsides and the Knob Hill. Would Mr. Hill build Dan Corbin’s line to the Boundary? Jim Hill said nothing. His game was bigger. If Grave’s ore body was as big as Colonel Linsley said, and as cheap to mine, a rail haul, while profitable, would not be enough. Jim Hill wanted the mines and the smelter as well. Very quietly, he began buying stock in Graves’ and Miner’s companies. Graves and Miner had organized three companies in 1899, the Old Ironsides, the Knob Hill, and Granby, to control the properties they owned on the ridge between Grand Forks and Greenwood. Graves brought Yolen Williams over from the California mine at Rossland, made him a director, and hired him to work out plans to extract the ore. Then, at the head waters of Twin Creek, just below their claims, Graves and Miner preempted a town site, called it Phoenix, built a water system, and began selling lots to merchants, saloon keepers, hotel men, and others moving to the new camp. The town site was a huge success. Buyers flocked in, scenting a new Rossland. Within 24 hours of going on sale, nearly every lot was sold for between $500 to $600. It was said that the town site sale brought in $100,000 to Granby. Graves and Miner now had enough for a down payment on a smelter, and began to build one on the North Fork of the Kettle River, just over Observation Mountain from Grand Forks. Breathlessly, miners, businessmen and investors, watched the CPR’s branch line to Phoenix being graded around the eastern slopes of Deadman’s Hill toward the mines. With the CPR laying tracks to their ore, and with directors, Miner and Gault, handling stock sales in Montreal, Aubrey White moved to New York and began selling shares there. They began moving briskly in the range of 80 cents. This was delightful news to the Spokane speculators who had bought their shares for a nickel. And at 80 cents, Jay Graves was now a rich man.

The Guggenheim brothers at that time dominated American metal smelting and refining. Walter Aldrige at Trail had served in one of their Colorado operations. Now Graves hired another one of Guggenheim’s smelter engineers, Abel Hodges, to put up a first class smelter on the North Fork site. With all this activity, the CPR queried Walter Aldridge, whether the Phoenix development was serious. Aldridge, who badly wanted the Phoenix ores for his Trail smelter, told President Shaughnessy that it was quite serious, and that the Old Ironsides held enough ore to support a small smelter. Shaughnessy was asked by Graves to build a 2-mile CPR spur into the smelter site from the C&W main line at Ward Lake. It was needed as quickly as possible, Graves emphasized, as the smelter machinery to be installed would be much too heavy for freight wagons. Aldridge and Shaughnessy wanted the Phoenix ore for the Trail smelter, and were in no mood to facilitate a competing smelter. They told Graves Granby would have to pay for the smelter spur itself, but the cost would be refunded if the smelter production should reach 100 tons per day. Aldridge underestimated Granby. The Phoenix ores were lean, averaging only 1-1/4 percent copper, and would require several smeltings to concentrate them enough for refining. Abel Hodges assured Jay Graves that he could smelt 150 tons of Phoenix ore a day, and that the spur cost would be recovered.

The CPR’s Phoenix branch left the main line at the Eholt summit and climbed up Coltern Creek on a 3.4 percent grade. At the head of the creek a small side hill cut, exposed a mass of chalcopyrite, a sulfide of copper and iron. An alert workman quickly drove stakes on it and sold it to the Dominion Copper Company as the Emma Mine. Aldridge and Shaughnessy were in no hurry to serve Jay Graves’ interest, and at this spot they abandoned the climb to Phoenix and ran a 2-1/2 mile spur out to the B.C. mine. Aldridge urgently wanted that mine’s ore, almost pure copper pyrites, for his Trail smelter, as its high sulfur content would only require enough coal to ignite it in the smelter furnace. From then on the burning sulfur itself would smelt the ore. Graves was furious. The CPR was hauling Boundary ore to Trail before putting rails into his deposit. If Jim Hill were only on the scene, the CPR would not be trifling with him in this way. Angrily, he had to send his first ore shipments down the mountain by wagon to the Granby Smelter for its opening on April 11, 1900, exactly as the Le Roi had had to do from Rossland, four years previously. Finally, the CPR sent its crews back to the Emma mine, and began grading up the east side of Deadman’s Ridge toward Phoenix. Not a quarter mile from the Emma, their grading exposed another mass of copper ore, and with no Trail engineer present, it was staked as the Oro Denoro, and sold to the Dominion Copper Company.

From that point the graders carefully examined every stone for traces of copper, but no further bonanzas were uncovered in the steep climb to the ridge top flat at the Wellington Camp (later Hartford). At the chaotic Wellington Camp the ground was covered with stores, tents and cabins whose owners demanded exorbitant prices for a right of way. The CPR hastily put in a switchback on perfectly level ground rather than pay for the land needed for a loop. (Later on, when the Wellington Camp declined, a loop was built.) The switchback reversed the line north where it climbed through the Rawhide, Gold Drop, Curlew, and Snowshoe claims, and turned into a shallow pass at an elevation of 4500 feet to enter the head waters of Twin Creek, the new town of Phoenix and the Granby Company’s mines.

In June of 1900, the rails were spiked down, and the line was complete. On July 11, the first trainload of ten 30-ton cars of ore from the Old Ironsides mine departed Phoenix behind CPR L class Consolidation No. 317. At Smelter Junction, the train was split, with five cars set off to be forwarded to the Trail smelter, while the remaining five cars were trundled down the 2 mile spur to the to the Granby Smelter. They arrived at 5:30 PM and were received with elaborate ceremony. Jay Graves and his family, together with C.H.S. Miner, Abel Hodges, and their families, were present. A local brass band played, and the whistle cords of the engines were tied down to express the jubilation of all present. It had been a tremendous gamble, but Jay Graves had won. The two smelter furnaces were fired up the next day, and another trainload of ore arrived, the beginning of daily shipments from Granby and the other mines in the region. Jay Graves at once ordered two Thew steam shovels on flanged wheels for 36” gauge track. Quarry faces were blasted into the ore bodies at the Old Ironsides and the Knob Hill, 36” track was laid, and the two shovels began digging out the broken ore and loading it into 4 ton mine cars. Davenport 0-4-0 saddletanker locomotives hauled the mine cars out of the quarries to a loading platform where they were dumped into the CPR 30 ton ore gondolas below. At least one of the Davenport saddletankers was a special model for underground use, cut down to a five foot height, and requiring its engineer to operate it and fire it from a sitting position. This squat steamer could enter the caverns blasted into the quarry walls and pull out ore from underground.

All this mechanization was wonderfully efficient. Jay Graves boasted accurately to reporters that the Granby ores moved from quarry to smelter untouched by human hands. Dumping the mine cars was mechanized a few years later when a Granby employee invented the self-dumping Granby mine car. A wheel on the outside of the car would ride up on a slanting rail fixed to a vertical bulkhead in the dumping shed and tip the car as the Davenport pushed it over the chute. This “Granby Car” was sold all over North America in subsequent years. As soon as the CPR tracks reached the mines at Phoenix, production went on a six-day week. The ores rolled in short trains down the steep 12 mile grade to Eholt where they were made up into trains for the Granby smelter and cuts of cars for Trail to be picked up by the next way freight. A second Shay locomotive, No. 112, identical to the 111 working the Rossland hill, was ordered and put to work on the Phoenix line hauling ore down the hill, and bringing coal and freight up to Phoenix.

With the completion of the Phoenix line, the CPR shifted its crews to Greenwood to build another steep and crooked branch up Motherlode creek to serve the Deadwood, Sunset and Motherlode mines. The branch left the main line just a few hundred feet north of the C&W station, and climbed the rock bluff above Boundary Creek on a 3.8 percent grade to enter Motherlode Creek above the new smelter being built by the B.C. Copper Company. From the smelter, the line climbed the left bank of Motherlode Creek to the town of Deadwood, and the Greyhound and Deadwood mines, also open quarries like the Phoenix mines. From Deadwood the line was built on that same 3.8 percent grade up Castle Creek to a switchback (later replaced with a loop) which reversed it out of Castle Creek and up Motherlode Creek again to the huge Sunset open pit, or “glory hole,” as they were then called. A quarter mile farther on it reached the Mother lode mine and its even bigger glory hole. Shay 113 was purchased in 1903 to work this branch.

The CPR surveyors had continued past the Motherlode mine, locating a line winding in and out of creek valleys and looping around the noses of ridges to Dan Corbin’s King Solomon mine. This location was known as Copper Camp, at 4400 feet elevation, with the King Solomon and Enterprise as the major producing mines. The line past Motherlode, however, was never graded or built. Probably because the CPR demanded the mine owners pay for it, with reimbursement after a certain tonnage had been shipped. Agreement was evidently never reached, and the end of track remained at Motherlode with the King Solomon and Enterprise ores coming down to that point on wagons.

From the Canadian Pacific’s point of view, the building of the Columbia and Western with its spurs and branches was more a defense against Jim Hill than a profitable investment. They had spent an estimated 7 million dollars to put rails into the Boundary country from Robson West, and yet the mining companies had spent but 4 millions in their developments. Worse, the startling news came that Jim Hill had bought the supposedly defunct charter of the Vancouver, Victoria and Eastern and his surveyors were staking grades into the Boundary country and up into Phoenix itself.

The CPR built a further spur from the Eholt-Phoenix line to serve the Jackpot and Athelstan mines, and surveyed two more grades long the spine of the Midway range across the border to reach the City of Paris and No. 7 mines at White’s Camp, and the Washington and Lone Star at the head of Big Goosmus Creek in Washington.These two last branches were never built; again, the owners would not pay, and found they could build a 5-mile aerial cableway to transport their ore back across the border into Canada and down to a second Boundary Creek smelter being erected by the Dominion Copper Company. It went into operation in 1901. With three smelters competing against him for Boundary copper, Walter Aldridge was finding it difficult to obtain sufficient ore for his Trail smelter. His Canadian Mining and Smelting Company was obliged to buy or lease producing mines to secure a dependable supply of smelter feed.

By 1902 the Granby smelter was operating at capacity, and still more ore was coming down from the huge Knob Hill and Old Ironsides pits. Graves and Miner merged all their Companies into Granby Consolidated Mining, Smelting and Power Company, Ltd. and issued $15 million in stock. $11 million went to the stockholders in the old syndicate; the rest was put on the market to raise funds for enlargement of the smelter, the installation of a converter to produce nearly pure copper, and for a hydroelectric plant at Cascade, on the Kettle River, to furnish additional power for the smelter and to electrify the mines at Phoenix. This enormous capitalization looked suspicious to many. No one knew how deep the Old Ironsides and Knob Hill ore bodies were. Did they really have $15 million dollars worth of ore? Neither Graves nor Miner could answer this question definitively. Speculators wondered if Graves and Miner were preparing to sell out at this inflated value before the ore bottomed out.

For his part, Graves had a new scheme. This minor real estate developer from Spokane was going to try to play the two hostile railroad barons against each other for his own interests. Graves was never shy; he approached Thomas Shaughnessy, President of the CPR, with a plan to keep Jim Hill out of Phoenix. He proposed that Granby should continue to smelt its own ores in its own smelter. But since there was more ore now coming out of the ground on the heights around Phoenix than the Granby smelter could handle, and the cost of transporting ores to Trail over McRae pass was uneconomic, the CPR could build a second Grand Forks smelter, a custom smelter to handle all the ores from the mines not owned by Granby, B.C. Copper, or Dominion. These ores could not stand the shipping charges to Trail and were going begging for treatment. If the CPR would build this custom smelter, Graves promised he would offer as security for loans to build it, 28 options he held on mines in both the Phoenix area and also down in Republic, Washington in the new Eureka Creek mines. If the CPR accepted his offer, he would guarantee them the haul from all these mines to the custom smelter as well as the Granby haul to its smelter. Graves estimated revenue from these hauls to be $800,000 per year. It was not unreasonable; CPR was already getting $380,000 a year from its haul to the Granby smelter alone. It was a clever scheme; by using the capacity of a second Grand Forks smelter to contract for all the Boundary ores offered, nothing at all would be left for Jim Hill to haul. He might run his rails up to Phoenix if he wished, but when he got them there, there would be nothing to load into his cars.

If the impetuous Van Horne had still been in charge, he might well have agreed. But the cautious, conservative Shaugnessy was now President. He sought advice from Walter Aldridge. Aldridge told him the Boundary mines were overrated, that they were shallow deposits that would soon play out, that Graves could not demonstrate proven reserves of ore. Shaugnessy turned down Graves’ offer. As it turned out, this was a spectacular mistake. Copper prices would soar during World War I making even the poorest Phoenix ores profitable.

Undismayed, Graves turned around and sounded out Jim Hill. His new scheme, which he put to Hill, was nothing less than a proposal that the two of them should buy Granby outright. He asked Jim Hill for a loan of $2 million to buy 500,000 shares of Granby at $4. With the 150,000 shares he owned or controlled through relatives and employees that would give Hill and himself control. With control of Granby, Hill, when his rails reached Phoenix, could then take all of the Granby traffic and the CPR would be starved of ore. After promising funds, Hill had second thoughts. His suspicious nature which George Stephen had played upon so successfully, asserted itself. He could not bring himself to participate in another man’s scheme. When Graves got to Montreal to make his stock purchases, there was no money waiting for him. He found the Granby directors ready to sell, as he had predicted to Hill. They thought the future for copper was speculative, and wanted to get out while the stock price was favorable. They were selling, however, to William H. Nichols, a New York copper refiner. Frantic letters to Hill produced no result. Graves’ scheme was slipping away from him. When the other directors, unaware of Graves’ intentions, invited him to go along with them and sell to Nichols, he had to agree. Hill eventually sent him a stingy $25,000 in New York in case Nichols should change his mind, but it was too late. Nichols and his New York associates had bought Granby outright.

One has to wonder at the eagerness of the Canadian stockholders to sell out to the Americans when it had been appeals to their patriotism that had brought them into Granby in the first place. Emotionalism is probably much more a factor in business than most will admit. In 1902 Jim Hill’s men crossed the border into Canada at Cascade and began grading toward Grand Forks. There they were halted by an injunction obtained from the court by one of the most preposterous railroads ever to run a train, Tracy Holland’s “Hot Air Line.” Jim Hill had encountered his newest and most pestiferous adversary.

The Grandeur of The Grand Canyon

March 7, 2017 / Peter Klopp / 2 Comments

For all my blogging friends, who love nature and amazing landscapes, I recommend viewing this fascinating post.

The Learning Curve

The only wonder of the world that I have covered (yet) – the majestic Grand Canyon!I was completely in awe of the force of nature that carved out the canyon millions of years ago. It still sends shivers down my body when Ithink about standing there and wonderinghow on earth these would have formed!Just a day after landing in Las Vegas, we were on our way to the South rim of the Grand Canyon (we were tocome back to LV and stay there for 3 days ending on Christmas eve, to enjoy the celebrationsin the city).

Though many tourists specificallygo to the West rim to do the Skywalk,we left it out intentionally since it is too expensive at $80.94 per person for the Legacy Gold Package. Moreover, if you are not so sacrosanct about doing the ‘walk on the glass bridge,’ you get pretty much similar views of…

View original post 432 more words

Creating and Managing Menu Items for your Family History Blog

March 6, 2017 / Peter Klopp / 3 Comments

A Very Basic Tutorial – Part II

Once you created a new page on your family blog (see Part I), it is actually quite simple to fill it with content from your posts. Let’s assume you just posted the first chapter about your grandparents. To copy the post onto your new page, e.g. ‘My Grandparents’, you follow the standard editing commands. Click anywhere on your post and select its entire content by pressing Ctrl + A and then copy it by pressing Ctrl + C. Then to the left of your post click on Pages and then on All Pages at the drop down menu. Then click on the list item that contains your page. Once you see the page on the computer screen, click at the top of the page and press Ctrl + V to paste the entire post content. Make sure to save the page before leaving it.

Now when you post chapter 2 or the next part of chapter 1, go through the same process, but make sure to paste the new content at the bottom of the previous post. That way you will allow your readers to read your family history in perfect chronological order.

In Part III I will introduce you to multiple pages and explain how to structure them to accommodate the various branches of a family tree. Until then happy blogging!

Chapter 25 of the Peter and Gertrud Klopp Story – Part VI

March 3, 2017 / Peter Klopp / 13 Comments

Philosophical Musings on Love, Marriage and Family

Church in Watzenborn-Steinberg

Now it was my turn to write and lay out my philosophical musings on love, marriage, and family within the context of their place in society. Just like Biene, I allowed my thinking to go far, even taking a fanciful glimpse into a romantic notion of immortality.

When I think about two people, who love each other, I see two streams that arise from two different springs, wind through narrow ravines and then, free again, pour into a wide valley, sometimes wedged in, sometimes wide, yet steadily growing in power and strength, finally join and from then on flow together towards their goal, the sea. Who can say which is greater, more glorious and more beautiful? Perhaps an onlooker from one region would praise the charm of the first river, while another would be more pleased with the foaming waterfall in a gorge of the second. What the two have in common is not remarkable, because their charm lies in their difference. So it also appears to me between a man and a woman! For with them as well we see their intrinsic value in their being different from each other.

As we both are different and only when united have a common goal, so will different tasks occupy our entire being. Thus, dear Biene, I am certain, you will want to be wife and mother and you will see in this task your greatest and most beautiful role, and I would like to be husband and father and make sure that I put on a solid foundation, what you in your uniqueness will accomplish in the home through love and warmth for husband and children. And should someone ask us about our understanding of equality, we would simply reply that it is respect for each other’s uniqueness. We will then have said much more than if we had spoken longwindedly about the social position of man and woman in the human society. With it we express the idea that we do not wish to distort nature’s laws in our desire to be equal, but in responsibility for each other and for the family we are on par, of equal worth and value.

Each person, no matter how insignificant and low in the eyes of the world, influences his environment by his very being. His parents care for him and draw him into their thoughts and feelings. And so he also influences their decisions, as long as he in some way depends on them. Because of him they postpone perhaps a vacation trip or even cancel it; because of him there is perhaps a car accident or perhaps not. Few people are connected with him with their decisions, but the few are intertwined in a remarkable way with thousands of other people, who in turn have an impact with their actions on others. Thus, everyone makes a small contribution to the history of mankind. One need not be Caesar, Napoleon or some other great figure to change the world we live in. Everyone does it, whether he is aware of it or not. But it is good to know one’s power to this effect.

A teacher, who is ambitious and uses his subject areas to have good students graduate year after year, can say at the end of his career, ‘My knowledge and my thoughts did not remain buried in books or in my head, but have beneficially spread among so many people. He will be satisfied with his life, and after he will be long gone, his ideas and thoughts mysteriously live on in thousands of minds and produce for a long time to come precious results. Would he not catch through his work a tiny sliver of immortality? I find, if one looks at life that way, the world appears much brighter, even death loses some of its sting. Thoughts, ideas, knowledge are invisible and work in the shadow of the human spirit, until they step forth in action and then, even if it only happens on a small scale, change the world. You may wonder, dear Biene, what I’m driving at. I would like to lead a life with you and be there for you and the family. And that is only possible if I enter a profession, which first of all brings joy to my heart and secondly offers us financial security. Later on in my profession as teacher I hope to positively affect young people and, as much as I can, will follow with great interest their life’s journey. The question will always occupy my mind, ‘What will become of them?’ However, in my work I will never forget the family and leave its care and worry to you alone. You know, dear Biene, I believe that we live on through our children. And even if one day we will have become old and gray, part of us will always carry over to them, our flesh and blood, and after years of nurturing certainly also our way of life. I would like to cling to this idea, which in its realization will bring so much comfort to us, and it is my greatest desire that one day all this will become reality.

Mother

Sitting on Mother’s sofa, Biene and I shared these wondrous thoughts that have so prophetically crystallized into words written down in Biene’s special dream book. They were clear and easy to grasp, to which we could attach our hopes. They were destined to be the blueprint for our entire lifespan.

STEEP AND CROOKED … by Late Writer, Artist & Castle Builder Bill Laux – Chapter VIII

March 1, 2017March 1, 2017 / Peter Klopp / 4 Comments

STEEP AND CROOKED: THE MINING RAILROADS OF THE CANADIAN BORDER

By Bill Laux

CHAPTER EIGHT

A CLASH OF CAPTAINS:

HILL, VAN HORNE, AND “THE ASSOCIATES”

James J. Hill

William Cornelius Van Horne

James Jerome Hill, of St Paul, Minnesota and the Great Northern Railway, was at home on both sides of the border, and saw no reason why his railroads should not be as well. In 1870, as a Canadian living in St Paul, he was asked by Canadian Parliamentary Secretary, Joseph Howe, to travel north to Fort Gary (near present Winnipeg) to report on the Riel Rebellion. So isolated was the Manitoba territory from the rest of Canada by the trackless 800 miles of rocky wilderness north of Lake Superior, that St Paul was the nearest source of information, and the place through which travel to that remote region passed.

Hill traveled in March of that year by railroad, stagecoach and, dog sled over the snows. On the trail with his dogs, he encountered Donald Smith, of the Hudson’s Bay Company, returning from his own investigation of the rebellion. Their campfire talk led them to agree that the Red River Valley, as both prime agricultural land, and as the surest route from St Paul to Fort Gary,. Manitoba, and the Canadian West, would some day support a very profitable railway.

In the following years Hill enlisted the support of Donald Smith and his equally wealthy cousin, George Stephen, of the Bank of Montreal, in getting control of the steamboat business on the Red River, the route to Winnipeg. Their syndicate, “George Stephens and Associates,” comprised Stephen and Smith, as the financiers, Norman Kittson, The Hudson’s Bay Company’s Minnesota agent, operating the steamboat line, and Hill, their St Paul freight forwarder. Once in control of steam navigation on the Red River, the Associates then went after the bankrupt St Paul and Pacific Railroad which they intended to complete to the Red River and a connection with Kittson’s steamboats.

It was the mephistophelean George Stephen who devised a way to buy the incomplete and bankrupt St Paul and Pacific Railroad from its Dutch bondholders with their own money. The Dutchmen had invested $11 million in the railway to get its valuable land grant, and so far had received neither land nor a penny of interest. George Stephen offered to take their bonds in exchange for bonds in a new railway company which the Associates would form. The Associates were gambling that J.J., Hill could complete the railroad before the deadline, eight months away, and earn for them the huge land grant that went with it.

The new company’s worth, in five equal shares, was divided among Stephen, Smith, Hill and Kittson. The concealed fifth share was kept by George Stephen who passed it clandestinely to New York banker J. S. Kennedy who had been the Dutchmen’s representative and who had, somewhat unethically, persuaded them to accept Stephen’s offer. Stephen became president of the Associates’ new company, Smith became vice-president and Hill, the man on the ground, General Manager. When the original bonds received from the Dutchmen could not pay their interest, the Associates foreclosed, and became instant owners of the bankrupt railway. It was an extraordinary bargain; the Associates had put up but $280,000 to acquire a railroad with assets of 11 million. At once, Hill, with tremendous energy, pushed the railway to the Red River within the deadline, and the land grant was handed over. Sale of those lands brought the Associates $13 million over the years, but more importantly, they now had a railway to the Red River and the exclusive steamboat transportation along its waters to Winnipeg. The Associates, with this one coup, now controlled absolutely Canada’s only land transportation to its west.

The Associates renamed their railroad the St Paul, Minneapolis and Manitoba and capitalized it at $15 million. The railroad and the steamboat company became instantly profitable. Stock was quickly bought up by the public and the proceeds were used to pay off the construction debt.

Through another of George Stephen’s manipulations, the Associates were able to buy back $11 million of the bonds they had given the Dutchmen for $1 million. Hill, on Stephen’s instructions, refused to redeem the interest coupons on the bonds with the railway grant lands, alleging that the Dutchmen had violated the terms of the bond exchange agreement. The bamboozled Dutchmen, who were primarily interested in land, sold out in disgust.

The new Canadian government had been seeking a way to build the transcontinental railway which it had promised British Columbia and the rest of Canada from its inception. The only syndicate sufficiently strong to undertake such a project was The Associates with George Stephen in charge.

The Canadian government courted George Stephen. But Stephen was wary. Hill and Angus (of the bank of Montreal) pointed out to him that if some hostile syndicate, such as the NP or the Milwaukee built the Canadian transcontinental, their St P M &M would lose its international value and become but one more prairie granger line. If George Stephen accepted the offer of substantial land grants and a cash subsidy the Canadian government was offering, Hill and Angus promised, they would build the line. Hill, Angus and Stephen at that time saw the Canadian transcontinental as a valuable feeder line to the St Paul and Manitoba and felt its only rational route would be to dip into the U.S. at Sault Ste Marie and run via their SPM&M to Canada at Emerson. It would be madness, Hill thought to build a railroad across the Canadian Shield where no one lived and no agricultural land existed. Thus, from its inception, The Canadian Pacific Railway was paradoxically conceived by its builders and owners as an international extension of their American railroad.

George Stephen was more than naive in taking on the building of the Canadian Pacific. As with the St Paul and Pacific, he would find the financing, J.J. Hill would build the line, and they would all profit from the truly enormous land grant to be earned, in this case, 25 million acres. But the St Paul and Pacific had required but 87 miles of line to complete. This time the distance was 1900 miles, over unknown territory, and through two mountain ranges where no railroad passes had yet been located. George Stephen was able to wring concessions from the Canadian government: a monopoly on all rail transportation west from Winnipeg, and a further guarantee that the builders would own and run CPR forever. With these, Stephen thought the thing could be done for $45 million, of which the Government would advance half. It was an enormous and nearly disastrous underestimate.

Hill built the Associates’ SPM&M to the Canadian border at Emerson. The Canadian Pacific built from there to Winnipeg. George Stephen named J.J. Hill managing director of the CPR, and Hill moved to Winnipeg to direct the building of the line west to the Pacific. He discovered at once that the CPR was a swamp of confusion, ineptitude, and graft. In its first year,1881, it had spent $10 million and only built 130 miles of track. The chief looters were former Confederate General, Thomas Lafayette Rossiter, and his superior, Alpheas B. Stickney, who later would become president of the Chicago Great Western. The pair were working an outrageous scam, selling privileged information as to the line’s location to land speculators. The speculators could then buy up raw prairie land for $1.25 and acre and sell it as track-side locations a month later, for 50 times that amount. Hill still had the Mantoba road to run; he desperately needed a supremely tough superintendent to clean out the deadwood and grafters in the CPR, and to drive its grading crews ahead at top speed.

The man he hired was William Cornelius Van Horne, a hard-driving American whom he had met when Van Horne was resurrecting the Southern Minnesota line out of La Cross, Wisconsin. Van Horne was exactly Jim Hill’s kind of man, one who eagerly sought every possible responsibility, and when given it, produced solid results. Hill first offered Van Horne the presidency of his own St Paul, Minneapolis and Manitoba railroad. When Van Horne laughed in his face at the proposal, Jim Hill knew that here was a man with enough self-confidence to take over the chaotic CPR whose current managers were more interested in organizing pheasant hunts and champagne parties than building track.

Van Horne accepted, and brought along with him from the Milwaukee, Thomas Shaugnessy, to act as his purchasing agent. The team of Van Horne and Shaugnessy, the blustering, belligerent “Terror of Flat Crib,” and the suave, meticulous Chief Clerk ingeniously stalling every creditor of the nearly insolvent line with exquisitely polite requests for more detailed invoices, completed the Canadian Pacific and successively held its presidency until 1918.

Van Horne at once took the CPR by its ears and shook it thoroughly, earning his title, “The Terror of Flat Crick.” Van Horne’s arrival at any of the hundreds of end-of -track camps was described by R.K. Kernighan,

“…when manager Van Horne comes to town there is a shaking of bones… He is the Terror of Flat Crick… they are as frightened of him as they are of the old Nick himself.

“Yet Van Horne is calm and harmless looking. So is a mule and so is a buzz saw. You don’t know their inwardness till you go up and get the feel of them. To see Van Horne get out of his car and go softly up the platform, you might think he was an evangelist on his way to preach temperance to the Mounted Police.

“But you are soon undeceived. If you are within hearing distance you will have more fun than you ever had in your life before. He cuffs the first official he comes to just to get his hand in and leads the next one by the ear, and pointing eastward informs him that the walking is good as far as St Paul. To see the rest hunt their holes and commence scribbling for dear life is a terror.

“Van Horne wants to know. He is that kind of man. He wants to know why this was not done and why this was done. If the answers are not satisfactory there is a dark and bloody tragedy enacted right there. During each act the all the characters are killed off and in the last scene the heavy villain is filled with dynamite, struck with a hammer, and by the time he has knocked a hole plumb through the sky, and the smoke has cleared away, Van Horne has discharged all the officials and hired them over at lower figures.”

Hill was at first pleased with his choice; he had both found the man to terrorize the CPR into order, and also very cleverly removed a dangerous rival from the competing Milwaukee Road which was by then invading what Hill considered St Paul and Manitoba Road territory.

Hill’s pleasure was not to last long. As 1882 began, Van Horne had boasted that he would lay 500 miles of track that year, an unheard-of feat. Moreover, he had ordered in advance, every tie, bridge timber, rail and keg of spikes for 500 miles of railroad. His orders, filling 500 rail cars, choked Hill’s St Paul yards. The Manitoba found itself unable to move its trains until Van Horne’s cars were removed. Hill threatened to have his own men dump the cars where they stood. Van Horne, choosing his own time, eventually sent his own men down to offload the cars and permit Mr. Hill to run his railroad. But by the end of the year, Van Horne had laid an astonishing 548 miles of track, a record never bettered.

Hill constantly complained to Van Horne that he was not sufficiently concerned

for the well-being of the Manitoba Road, for in Hill’s mind the Canadian Pacific was to make the Manitoba Road thrive. But Van Horne had no intention of being the Associates’ pawn. Almost from the beginning he became a thorough CPR man. When the Canadian Pacific completed its line east from Winnipeg to Thunder Bay on Lake Superior, George Stephen promised a worried J.J. Hill that it would not be opened for another year so that their Manitoba Road would have all the haulage of CPR materials. Van Horne, however, instructed his traffic officials to bring in materials via the Great Lakes and the Thunder Bay route, a considerable cost saving, but cutting the Manitoba line out of the traffic. Hill protested Van Horne’s attitude, “…there is I know a feeling…of ill concealed hostility toward this company.” J.J. Hill had picked the one man thick-skinned enough to see the CPR through to the Pacific. But he had failed to realize that Van Horne was a man just like himself, stubborn, headstrong and supremely ambitious. It was inevitable they would clash. As well, Hill failed utterly to take into consideration that the Canadian Government, which was subsidizing the CPR construction by loans and grants, would absolutely insist on an “All Canadian” route to the north of Lake Superior. No matter that it made no economic sense, that it would not furnish a single carload of freight. Canadian nationalism demanded it. Canadian taxpayers would never permit their government to subsidize a railway through the United States.

George Stephen and Associates were not going to be able to construct the Canadian Pacific as an extension of the St Paul, Minneapolis and Manitoba; they were going to have to build an “All Canadian” route or forfeit government support. Hill, his advice ignored, his protests unheeded, found his position on the Canadian Pacific board untenable. He angrily resigned his position on May 3, 1883, and began selling his CAP stock. In a note to Kennedy, the clandestine fifth Associate, on the following day, Hill explained, “Mr. Van Horne… is inclined to take the view that the St Paul, Minneapolis and Manitoba are powerless to help themselves and must simply accept any situation that may be assigned to it by the Can Pac.”

Van Horne, seeing the CPR in a wider perspective than J.J. Hill, realized that his line could never fulfill the destiny he saw for it as long as it operated as a feeder to the St Paul and Manitoba. In an act that would render Hill an enemy forever, he declared the CPR’s independence by signing a preferential traffic agreement with the Northern Pacific, rather than with the Manitoba Road. When Hill discovered this, he sold his final 10,000 shares in the CPR in utter disgust, and became Van Horne’s implacable foe. “I’ll get even with him if I have to go to hell for it and shovel coal!” Hill swore.

The position of George Stephen in all this is curious. He was president of both the Canadian Pacific and of the St Paul, Minneapolis and Manitoba, now rival lines. Van Horne’s disregard of Hill’s interests had to have the President’s sanction, yet Hill, mesmerized by the aristocratic presence of George Stephen, never blamed him for the rift.

Stephen’s manipulations continued. In 1886, with the Canadian Pacific completed, George Stephen and Donald Smith secretly bought control of the Minneapolis, St Paul and Salt Sate Marie (the So line), railroad, a line charted by Minneapolis millers to bring wheat from the Dakota prairies to the Minneapolis mills and carry their flour to the year round port of Salt Sate, Marie. This line, a rival to both the CPR and the Manitoba Road, had been looked at by both Hill and Van Horne and rejected as weak line, unfinished and no threat. However, Stephen and Smith put $750,000 into it to complete it. Once finished, they intended to sell it to either the CPR or to Hill, whichever would bid highest for it. Hill discovered that the money had come from the bank of Montreal, and queried Stephen as to who was involved. Stephen mendaciously denied that he or Smith had advanced the money. With Hill still in the dark, Smith and Stephen went bargain hunting again, and bought the Duluth, South Shore and Atlantic, another line running from Duluth to Salt Sate Marie. Their purpose was the same, to sell it to either the Manitoba or the CPR. Hill began a savage rate war with both lines in an effort to drive them into bankruptcy. But from some unknown source, money kept being poured into these competitors. Eventually, Stephen had to confess to Hill that he and Donald Smith were behind the rival lines. Hill then questioned Stephen’s anomalous position as President of both the CPR and the Manitoba. In 1888 George Stephen sold the So line to the Canadian Pacific and resigned as CPR president. His place was taken by Van Horne who began to pour money into the So, as a “defense” against the Manitoba line.

Hill responded with a campaign against the CPR, delaying his passenger trains so that travelers would not make their connections at Winnipeg, and on one pretext or another, blocking freight cars a the border, tying up the CPR line.

The anxiety Hill felt about the So line which paralleled the Manitoba on the south was doubled when in 1893, Van Horne bought the Duluth and Winnipeg for the CPR, a line, that would when completed, parallel the Manitoba on the north. This put Hill in vice, and Van Horne, it seemed to him, was twisting the handle. For, if Van Horne could complete the Duluth and Winnipeg north to the border, the CPR, using D&W and So tracks would have its own line into St Paul and connections to the Chicago roads. Hill had to have the Duluth and Winnipeg, or he would be squeezed out of the Canadian traffic. Realizing at last that the CPR was now never going to use his Manitoba road as an American connection, he changed the name of the St Paul, Minneapolis and Manitoba to the Great Northern, and encouraged by George Stephen, struck out for the Pacific Coast on his own.

George Stephen had no intention of letting Van Horne destroy the Great Northern, which he could have done with the So and D&W. Stephen now began a treacherous campaign to get rid of Van Horne. In 1897 he forced Van Horne out of the Presidency of the CPR, took over himself,and sold the D&W to Hill.

George Stephen’s ambiguous position as President of the CPR from 1880 to 1888, and Chairman of the Board of the Manitoba Road from 1878 to 1886 gave him almost unlimited power to play with both lines for his own profit. He played the deluded combatants, Hill and Van Horne, shamelessly against each other, sliding adroitly from one camp to the other in his letters to them. Here he is to Van Horne on J.J. Hill,

“…he is the most ‘shame faced’ grown man I ever met, more like a very shy boy of 10 or 12 years than a full-grown man of 50.

“In dealing with him it is necessary to keep his odd ways in mind & to treat him rather as a spoilt child brimful of ridiculous suspicions of everybody he comes in contact with.”

Here he is to Thomas Shaugnessy on William Van Horne,

“It is quite evident that Sir William, either from failing health or from allowing other things to occupy his mind, is no longer able to give the affairs of the Company his undivided attention… His actions gave me the impression that he felt like a man who knew he was in a mess and had not the usual courage to look his position in the face.”

Manipulated by the Machiavellian Stephen, the two former farm boys, Hill and Van Horne charged at one another like maddened bulls, creating a bitterly hostile relationship between the Great Northern and the CPR which was to last for their lifetimes. Hill seems to have conceived the idea that by invading the CPR’s British Columbia territory with his profitless lines, he could trade them to the CPR for its So Lines in the U.S. He made the offer in 1897 and was refused. Rebuffed, he continued to build Canadian lines. When, in 1906, the CPR acquired Dan Corbin’s Spokane International and trackage rights with the UP to Portland, Hill responded with a threat to build a new Canadian transcontinental which would run from Winnipeg through Brandon, Regina, Calgary, Edmonton and the Peace River country.

Near the end of his life, with his “Third Main Line” (the Vancouver, Victoria and Eastern route) in its final stages of construction, Hill made one more move to confound the CPR in British Columbia. He conferred with the builders of the Grand Trunk Pacific who were building a second Canadian transcontinental on the Edmonton to Prince Rupert route, about extending a link northward from his VV&E to link up with both the GTP and the Canadian Northern. This link, if built, would have enmeshed the CPR in British Columbia, in a choking web of Hill lines.

Hill died in 1916, but in his last years the GN board withdrew support for any further construction in Canada. The defeat of the Liberals killed the Free Trade policy which Hill has supported and counted on. Without Free Trade, the GN would always be at a disadvantage in Canada. Hill’s son, Louis, taking over the Great Northern in his father’s last years, immediately stopped work on the VV&E and negotiated a joint trackage agreement with the CPR for that route. It was never used. Louis Hill and his successors began a slow withdrawal of the profitless GN lines from B.C. Today only a hundred miles of ex-GN track remain in B.C., the steep and crooked line from the border to Nelson, the 12 mile arc into the Kettle Valley on the Republic line, and the route from the border at Blaine to the Vancouver terminal.