in aid, or services
would have to be withheld in districts where it was desirable they
should be provided. Some members were disposed to think the better
course would have been to retain the old rate for letters and to allow
newspapers to pass free, as had long been the practice in the Lower
Provinces; and the imposition of a rate on newspapers was characterized
as a tax on the dissemination of public intelligence and a retrogressive
step towards old and exploded abuses.[127]

Other members desired to follow the English example and reduce the
letter rate to 2 cents, the equivalent of a penny; but this was deemed
impracticable on account of the different conditions under which the
Post Office was conducted in Canada, where the mails were carried very
long distances through a sparse population.[128] In the United States,
where the circumstances were more nearly comparable, the rate was still
3 cents. With a rate of 3 cents in Canada, as proposed, it was
anticipated that there would be a considerable deficit, but that the
deficit would soon disappear.[129] It was alleged that there was no
demand for a reduction and that everybody was willing to pay 5 cents;
but the real objection was not to a reduction in the letter rate _per
se_. The objection arose from the assumption, fairly well grounded, that
the reduction was only possible if accompanied by the establishment of a
postage on newspapers, to which a number of members were strongly
opposed. The rate of 3 cents for 1/2-ounce letters was, however,
adopted. In three years the yield of postage at 3 cents surpassed the
former yield at 5 cents.[130]

In 1898 a Bill for modifying rates of postage was introduced. The main
propositions of the Bill were (1) to reduce the letter rate to 2 cents
per ounce, and (2) to impose a postage on newspapers. Since 1867 there
had been several changes in newspaper postage, and for about nineteen
years newspapers had been passing through the post in Canada free of any
charge for postage.[131] The postal service was at this time being
carried on at some loss to the general Dominion revenue, and, as in
1867, the proposal to charge postage on newspapers was made to
counterbalance any loss of revenue which might result from the reduction
in the letter rate of postage. It was hoped that with this
counterbalance any such loss would soon be made good, and that, indeed,
the Post Office would become a self-sustaining department.[132]

The arguments in