"World's Greatest" Railroad

In the Dominion of Canada there is a large corporation which last week was planning to spend some $5,000,000 on two hotels in Canada, and to build a new hotel in London, England. This corporation has also let contracts for an Atlantic liner, Empress of Britain, and a Pacific liner, Empress of Japan, the two ships to cost nearly $20,000,000. It owns some 140,000 miles of telegraph wire, distributes millions of young trees (gratis) to Canadian farmers, has settled more than 55,000 immigrants on more than 30,000,000 Canadian acres, and operates a traveling school that brings education into sections of Ontario in which little red schoolhouses have not as yet been established. Yet this corporation is not primarily in the hotel, the steamship, the agricultural or the pedagogic business. It is a railroad company, which operates more than 20,000 miles of line, thousands of miles more than any U. S. railroad.* Known on the Manhattan Stock Exchange by the symbol CD, it is more generally referred to as Canadian Pacific Railway Co.

With its main line running from Montreal to Vancouver, with the extent of its entire transportation system, including its Atlantic and Pacific fleets, best indicated by the fact that it has a contract with the British Empire to carry mail from Liverpool to Yokohama, the Canadian Pacific might well advance a claim to "world's greatest" railroad. Its neighbor and chief competitor, the government-controlled Canadian National, has 22,000 miles of line, but Canadian National's mileage is perhaps too great for its own good and only the rare vigor and ability of U. S.-born Henry Worth Thornton (TIME, Jan. 28) has lifted Canadian National out of the annual deficit class. No deficit problem has Canadian Pacific. In 1928 it showed a net operating income of over $51,000,000 and net earnings of over $48,000,000. Its common stock earned $15 a share. Canadian Pacific has a 1929 high of 267 7/8, is thus selling at 17.8 x earnings. U. S. railroads traditionally sell at around ten times earnings, but in Canada there is no Interstate Commerce Commission and no recapture clause to limit a road's earnings on its investment. In addition to its extra-railroad activities, Canadian Pacific has asked the Dominion Parliament for authority to construct 1,200 miles of branch lines and expects to build some 465 miles during the present year. Expansion plans centre around the Saskatchewan district and may result in a "war" with Canadian National which has considered the Saskatchewan territory as particularly its own. Should hostilities result, the Canadian Pacific has assets of about one and a quarter billion dollars.

President of Canadian Pacific is Edward Wentworth Beatty,/- not to be confused with Admiral Beatty, whom he somewhat resembles but to whom he is not related. He is the first Canadian-born head of Canadian Pacific, two of his predecessors having come from the U. S. and the other from Scotland. President Beatty never walked any tracks, was not at all a poor nor particularly a good boy. Indeed, authorities at his Toronto preparatory school considered young "Banty" Beatty no credit to the institution. Concerning his school life, he says: "Most of my spare time was spent in doing extra work occasioned by my not having done the work I should have done when I should have done it. I had an excellent record for the number of canings, which I thoroughly well earned. . . ." Across one of his report cards was written the notation: "In the opinion of the principal, it is not desirable that this pupil should return to the college." At the University of Toronto, Student Beatty excelled chiefly in football. But once with the Canadian Pacific (1901) Railroader Beatty speedily demonstrated that bad marks do not a wastrel make. When, at 41, in 1918 he became Canadian Pacific's president, he was youngest railroad president in the world and head of the world's largest railway.

President Beatty has not "had the time nor the inclination" to marry. He lives in Montreal, smokes a pipe, pulls his hats far down over his right eye. No golfer, he is a handball enthusiast, plays, when possible, 40 minutes daily. He is fond of reading, especially of reading the history of the Middle Ages. He is personally and philanthropically interested in the Shawbridge Boys' Home, an institution for "underprivileged" boys.

President Beatty once shocked an interviewer by announcing that he did not know what was current stock quotation of Canadian Pacific, adding that there was not a single stock ticker in any Canadian Pacific office. "Tickers," observed President Beatty, "are a sign of stock manipulation. The Canadian Pacific management has never done that." Doubtless President Beatty does know, however that 57% of his stock is held in the United Kingdom, 13% in Canada, and about 24% in the U. S.

A glance at a railroad map of Canada shows the Canadian Pacific running across the Dominion like a backbone, with many a branch arm and leg to complete the skeleton analogy. Both Canadian Pacific and Canadian National lines stretch from Halifax to Vancouver. Generally speaking, the Canadian National lines lie farther to the north, especially west of Winnipeg. The Canadian Pacific hugs the U. S. border and with its Minneapolis, St. Paul and Sault Ste. Marie subsidiary runs through North Dakota, Minnesota, Wisconsin. And, indeed, the Canadian Pacific has been in many ways a backbone of the Dominion.

During the World War, the Canadian Pacific loaned the Allies $100,000,000, made many a shell and cartridge, sent to the War 11,000 employes of whom 1,100 were killed, transported 1,000,000 troops, and lost 15 steamships.

*Southern Pacific, 14,518 miles, is longest U. S. system.

/-The recent and contemporary history of Canadian railroads is found in the careers of Canadian Pacific's Beatty and Canadian National's Thornton. Beatty was born a British citizen; Thornton became one (1916). Both have been honored by the British Crown. Beatty is a King's Counsel; Thornton a Knight Commander, Order of the British Empire. Both played football, Beatty at University of Toronto; Thornton at University of Pennsylvania. Beatty was Canadian Pacific President at 41; Thornton president of the Canadian National Railroad at 41. Both came from railroad offices, not from railroad tracks. Beatty took over a strong system, made it stronger; Thornton took over a sick system and made it well.