Crow Rate

Train heads west into the Crowsnest Pass

Crow Rate was a pivotal piece of Canadian transportation policy, established in 1897, that set a fixed, low rate for shipping grain by rail from the Prairies to the ports on the Great Lakes and the Pacific coast. This rate was named after the Crow's Nest Pass Agreement, which was negotiated between the Canadian government and the Canadian Pacific Railway (CPR). The agreement was initially intended to aid in the settlement of the western provinces and to stimulate the export of grain to international markets.

History

The inception of the Crow Rate can be traced back to the late 19th century, during a period of rapid expansion in Canadian agriculture and rail infrastructure. The Canadian government sought to encourage the settlement of the western provinces of Alberta, Saskatchewan, and Manitoba. To achieve this, it was deemed necessary to provide affordable transportation for farmers to get their grain to market. The Crow's Nest Pass Agreement, therefore, stipulated that the CPR would receive land grants and financial subsidies in exchange for maintaining a low freight rate for grain.

Over the years, the Crow Rate became a cornerstone of the western Canadian economy, allowing for the profitable export of grain. However, it also led to significant financial losses for the railways and was a source of contention between western farmers, the railway companies, and the federal government.

Impact

The Crow Rate had a profound impact on the development of the Canadian west. It facilitated the growth of the grain industry, which became a cornerstone of the economy. The policy helped to ensure that Canadian grain could compete in international markets, particularly in Europe, by keeping transportation costs low.

However, the Crow Rate also had its drawbacks. It placed a heavy financial burden on the railway companies, particularly the CPR, which argued that the rates were unsustainable in the long run. This led to numerous debates and discussions about the viability and fairness of the Crow Rate.

Controversy and Termination

The controversy surrounding the Crow Rate intensified in the latter half of the 20th century. Critics argued that it was an outdated policy that distorted the transportation market and hindered the development of a more efficient and competitive rail system. Supporters, however, maintained that it was essential for the economic viability of western Canadian farmers.

The debate culminated in the gradual phasing out of the Crow Rate. The Western Grain Transportation Act of 1983 modified the original terms, leading to increased rates. Finally, in 1995, the Canadian government fully deregulated grain transportation, effectively ending the Crow Rate. This move was part of broader efforts to modernize the Canadian rail system and to promote a more market-driven approach to grain transportation.

Legacy

The legacy of the Crow Rate is mixed. On one hand, it played a crucial role in the development of the Canadian west, supporting the grain industry and facilitating the settlement of the prairies. On the other hand, it is seen as an example of government intervention that ultimately became unsustainable and out of step with the principles of a free market economy.

The end of the Crow Rate marked a significant shift in Canadian transportation policy and had a lasting impact on the country's rail system and agricultural sector. It remains a topic of interest for historians and economists studying the evolution of Canadian transportation and agricultural policies.