WHO IS GALT GARDENS IN LETHBRIDGE NAMED AFTER?
Galt resigned following Canada's first banking crisis in November 1867
Jean-Pierre Kesteman, National Post
A very interesting and detailed historical biography of Canada's first Finance Minister was published recently in the Financial Post. Here are some highlights that show the unique nature of Canadian capitalism, it is one of the earliest developments of what would become historical state capitalism.
It shows that Quebec was developed industrially by British Capital in particular by land grants given to mercantilist interests back in London.
During the years in Sherbrooke, Galt had not only become acquainted with the region, its resources, and its inhabitants, but had also fitted himself gradually into the community of businessmen and half-pay officers who, under the aegis of Edward Hale*, formed the nucleus of a local bourgeoisie. In November 1842, on the eve of his return to London, Sherbrooke's fashionable society honoured him with a farewell banquet. It seemed clear to everyone that this able administrator was marked for advancement to senior office in England and would not be coming back.
During the 12 years he held this post in the Province of Canada, Galt, with the backing of his superiors, had enough independent authority to make decisions about reinvesting some of the money received from the sale of land in various land developments and in manufacturing and railway ventures. These investments were designed to provide outlets for a region that had hitherto been poorly provided with means of communication, and also to develop Sherbrooke as an urban, industrialized centre. Thus, disposing of sizeable funds and broad powers, he became, with the company's money, the architect of Sherbrooke's industrial beginnings in the period 1844–54.
Galt's strategy involved building new dams, offering industrial sites with long leases, making construction loans to the lessees, and promoting manufacturing concerns directly. Thanks to him the shores of the Rivière Magog were dotted with workshops and small factories as well as larger ones such as Adam Lomas's woollen manufactory, the flour-mill belonging to Edward Hale and George Frederick Bowen, and William Brooks's paper-making firm with its two factories and new Fourdrinier machine. In addition Galt managed two enterprises of the British American Land Company itself: a large sawmill and then, in 1851, a factory for making pails. But it was unquestionably the establishment of cotton goods manufacturing in 1844 that best illustrates the decisive role he played in bringing the Industrial Revolution to Sherbrooke.
The Sherbrooke Cotton Factory, the first cotton mill in the province and the first joint-stock industrial company to be incorporated in Canada, was launched with local capital in 1845. Galt personally contributed £500, and when in 1847 the factory was on the verge of bankruptcy, hampered by the constraints of its charter and the inability of numerous small shareholders to pay for their subscribed shares, Galt himself bought back the assets for British American Land. With help from Hale and an American manager, Charles Philipps, he started it up again in 1848 by providing more capital and overseeing operations. So successful was he that by 1851 the company was flourishing and he was able to sell it for £3,000.
After 1844 Galt also distinguished himself as a railway promoter. It was this activity that would finally lift him out of the confines of the Eastern Townships and make him a national figure. The earliest plans for building a railway to end the isolation of the area through links with Montreal and Boston dated from 1835, the year Galt arrived in Sherbrooke. Put aside during the political and economic uncertainties of 1837–38, the idea had been taken up again in 1840 and a company of businessmen from the Sherbrooke region under Hale's direction was incorporated in 1841. Galt was among the promoters, but in the minor capacity of secretary or organizer of meetings. This second initiative was abandoned for want of capital, but during Galt's stay in London in 1843 a third attempt was made, again by promoters from Sherbrooke, which was to lead to the incorporation two years later of the St Lawrence and Atlantic Rail-road Company.
When he returned in May 1844, Galt enthusiastically endorsed the project: he would soon be its chief organizer, along with Samuel Brooks and Hale. These two men, who would be re-elected to the Legislative Assembly of the Province of Canada in November, secretly promised in Galt's presence to oppose any ministry that refused to give financial aid to the railway. Once the company had been incorporated, Galt took $30,000 worth of shares in his own name and $96,000 worth on behalf of the British American Land Company. To persuade the Montreal public to invest heavily, he brought into play his connections with Peter McGill* and George Moffatt*, both former representatives of the land company in Canada.
In June 1845 Galt was elected a director of the St Lawrence and Atlantic Rail-road, the only one, with Brooks, from the Eastern Townships, on a board chaired by McGill. Galt was instrumental in determining the route for the line, which was to cross the Eastern Townships, and in the choice of Portland, Maine, as the terminus rather than Boston [see John Alfred Poor*]. Once again he was sent to London, in July, to interest British investors in putting up the £500,000 capital still needed. His efforts met with limited success, as did another attempt to sell bonds on the London market in 1847, but, having faith in the future, Galt persuaded his fellow directors to begin construction anyway. Late in 1848 the first section, from Longueuil to Saint-Hyacinthe in Lower Canada, was completed.
The company was short of capital, however, and had to turn to the government. George-Étienne Cartier* presented their petition to the cabinet of Louis-Hippolyte La Fontaine* and Robert Baldwin*. It proved the critical step in securing passage in 1849 of a bill devised by Francis Hincks* stipulating that the Canadian government would guarantee payment of the interest on half the bonds of any railway with a line more than 75 miles in length, provided half of it had already been built.
To take advantage of the act the St Lawrence and Atlantic had to build another 45 miles of track, from Saint-Hyacinthe to Richmond. The company directors, at the end of their resources, entrusted both the chairmanship of the board and direct supervision of the work to Galt. With the help of Montreal promoter John Young*, he got the operations funded again by selling £50,000 worth of bonds to the Séminaire de Saint-Sulpice in Montreal and to the British American Land Company. He also removed the contract for construction of the line from the American firm of Black, Wood and Company and transferred it, with himself as supervisor, to engineer Casimir Stanislaus Gzowski. Thus, albeit with enormous financial difficulty, he was able to get the line built as far as Richmond in 1851 and thereby to obtain the government guarantee. The line to Sherbrooke was inaugurated by Governor Lord Elgin [Bruce*] in 1852, and the following year trains were running from Longueuil to Portland.
In 1865 and 1866 his time was increasingly taken up by his responsibilities as minister of finance. In this capacity he began discussions with American officials on the prospects for extending the Reciprocity Treaty of 1854. He secured passage of a measure reducing import duties on manufactured goods and authorization for the Province of Canada to issue bank notes constituting legal tender to a value of $5,000,000, a privilege hitherto restricted to the banks
Galt was returned for the town of Sherbrooke to the federal parliament after agreeing, with some hesitation, to assume the responsibilities of minister of finance for the new dominion in Sir John A. Macdonald's government. He was not to be part of it for long, however. In the autumn of 1867 the Commercial Bank of Canada, struggling with financial difficulties, sought the government's help to avert bankruptcy. Galt first used his connections with the Bank of Montreal to seek a solution, but when banking circles refused to intervene, he decided to advise the cabinet to provide $500,000 in assistance to the Commercial Bank, in the interest of preventing the widespread panic that would ensue upon its closure. A second refusal resulted in the bank's ceasing operations, and Galt, who felt that he had been "betrayed" by Macdonald in this matter, chose to resign, a step he took officially on 7 Nov. 1867.
The 1880s also witnessed Galt's return to the business world, this time in western Canada. In 1881, while he was living in London, he had been informed by his eldest son, Elliott Torrance Galt, at the time assistant commissioner of Indian affairs in Regina, of the existence of coal deposits in the south of what is now the province of Alberta. In 1882, after inspecting the region, Galt founded the North-Western Coal and Navigation Company Limited with two British businessmen, William Henry Smith and William Lethbridge.
One of his aims was to supply coal to the CPR, which was still under construction west of Winnipeg. To transport the coal Galt and his partners first set up a system of steamships and barges on the Bow and South Saskatchewan rivers but subsequently built a railway line from their mines to Dunmore, near Medicine Hat, which was completed in 1885. In these territories that were not yet settled Galt's genius for organization, his solid connections with British financial circles, and the loyal, competent support of his son Elliott helped develop the Lethbridge region. The search for an American market for the coal led him to build a railway line in 1890 from Lethbridge to Montana, an undertaking made easier, in truth, by the grant of a million acres of land to the company by the Macdonald government. This grant led Galt and his partners to take an interest also in using the lands for agriculture and in making a start on a large-scale system of irrigation for the region. All these activities were the work of companies set up by Galt, his son, and a few partners, for example the Alberta Railway and Coal Company (1889) and the Alberta Irrigation Company (1893).
