. One year it was an additional
guarantee, another a temporary loan, again a postponement, and again a
still further postponement of the government's lien. It soon came to
be recognized that the money which had been advanced under the
guarantee provisions must be considered a gift, not a loan, though to
this day the amount nominally due still figures as an asset on the
Dominion government's books. Incidentally, the embarrassing government
directors were dispensed with in 1857.

The Grand Trunk was complete from Lake Huron to the Atlantic in 1860.
In the ten years that followed, working expenses varied from
fifty-eight to eighty-five per cent of the gross receipts, instead of
the forty per cent which the prospectus had foreshadowed; not a cent of
dividend was paid on ordinary shares--nor has been to this day.

What were the reasons for this disappointing result? The root of the
trouble was that the road was not built solely or even mainly with a
view to operating efficiency and earning power. It was the
politicians' road, the promoters' road, the contractors' road, at least
as much as the shareholders' road. The government had encouraged the
building of {83} unprofitable sections, such as that east of Quebec,
for local or patriotic reasons. Promoters had unloaded the Portland
road and later the Detroit and Port Huron road at excessive prices.
The contractors, east of Toronto, had had an eye mainly to construction
profits in planning the route, and heavy grades, bad rails, and poor
ballast increased maintenance charges beyond all expectations. The
prophecy that operating expenses would not exceed forty per cent of
earnings, based on English experience, failed partly because earnings
were lower, but more because operating expenses were higher, than
anticipated. The company had more than its share of hard luck from
commercial depression, and from loss on American paper money in the
Civil War. Water competition proved serious in the east, while other
railways waged traffic wars in Upper Canada. The trade of the far
west, which had been the most attractive lure, did not come in any
great amount for the first twenty years. Differences of gauge, lack of
permanent connections at Chicago, lack of return freight, rate wars
with the American roads which had been built west at the same time or
later, the inferiority of Montreal to New York as of old in harbour
facilities and {84} ocean service, the failure of Portland t