711.42157SA29/1484: Telegram

The Minister in Canada ( Armour ) to the Secretary of State

125. The Prime Minister informs me he received a letter this morning from Hepburn in which the latter reaffirms his opposition to the St. Lawrence project. He bases his opposition on competition with the railways whose earnings are already insufficient, and the fact that the power from this source will not be required: that he has other sources from which to meet increasing demands. Hepburn said that in the meantime, however, he had no objection to having the Dominion and Provincial experts meet to talk over the power situation as suggested by Mr. King. Hepburn is coming to Ottawa November 29 to see King on other matters, and the latter informs me he may have something more to report after this talk.

The Prime Minister said Hepburn’s letter also stated that he is in negotiation with Beauharnois and hopes for a favorable settlement shortly.18 King said that while Hepburn may be over-optimistic, the latter undoubtedly feels that if successful this will give him all the power he requires to meet present or future efflux.

  1. In telegram No. 128, December 11, 1937, noon, the Minister in Canada reported that a new contract between the Ontario Hydro Electric Power Commission and the Beauharnois Co. had been signed (842.6463/258).