PRINCE EDWARD ISLAND.

volume in itself. The main element only can be touched on. That was the building of a government railroad, some one hundred and fifty miles long to serve a population of less than 70,000. This was to be done on the credit of the provincial government.

Thirty year debentures, bearing four per cent interest. were to be issued to pay for the

railway. The public were told that the earn- ings of this road would keep it up and pay off these debentures in the time limit given. Every sort of verbal argument was used, but there were those who saw through the plot. Nevertheless, by the use of money, both on the electorate and afterward on some of the representatives, the, bill was railroaded through the House. It need not be pointed out that the spending of millions of money amongst a small population gave a tremen- dous impetus to trade. Contractors were found who were able to negotiate these thir- ty-ywr debentures, because behind them there was some unknown and solvent hand.

There were three banks on the Island but these did not at first get the debentures. A bank foreign to Prince Edward Island took them and the paper money of this foreign bank soon began to crowd the notes of the local banks out of circulation. These could not live without patronage, and they, either in ignorance or by design, sought to get hold of the thirty-year debentures, exchanging with the contractor their paper money. Large amounts of sterling exchange were wanted to pay for rails, rolling stock and the outfits of the many shops then building. The de-

mand for this exchange soon left the local banks without the specie necessary to redeem

their paper. They not only were drained of their gold, but could not sell exchange for $500 even on St. John. To make matters worse, a new government had been sent by

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the people with a mandate to build two branch lines from the main trunk. The same contractors agreed to build these with more thirty-year debentures. But the government forgot about providing ways and means to pay the land damages for the right of way. The government which had passed the rail- way bill had already increased the impost tax about twenty-five per cent to pay their land damages and a further tax would be unpopu- lar—so the provincial treasury was also short of funds. '

Had the general public known at this time the true state of the banks a run would have been made that would have closed the doors of all of them in one day. The Pre- mier was sent for, a cabinet meeting was called, and the true state of the financial situ- ation was put before the council. There was only one thing to do. The Premier, the leader of the anti-confederates, was given to understand that there was one way, and only one way, to save the province from actual bankruptcy, for after the local banks had be- come possessed of these remarkable deben- tures they became practically worthless—the unseen hand that had supported them was withdrawn and the Premier_must sell the right of indirect taxation to the Dominion, must sell our self-government, our liberties,

Your prosperity, our birthright, for a mess of

pottage. Secretly he fled to Ottawa. They well knew there what it was all about. Well, we were sold. The terms of union were ap- parently generous, for they contained coun- terfeit coin, like the old Island cents and half pence, which enriched a few, but robbed the many. Let us here point out that only one issue of the many issues of copper coin which was used before confederation had the sanc- tion of the government, these coins bearing such inscriptions as “Speed the Plough,”