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Memoirs of Robert Dollar
Vol. 1 - Chapter Twenty-four. Eloquent Appeal for a Greater American Merchant Marine

The first part of 1917 was eventful. In January of this year Mrs. Dollar and I attended the annual meeting of the Foreign Trade Council at Pittsburg, Pennsylvania. There was a large attendance, those who registered numbering twenty-five hundred. It was not so much the number, as the high class of men who attended. They represented the big commercial and banking institutions of the United States, which showed conclusively that the country had at last awakened to the necessity of foreign trade. It was as enthusiastic and as earnest a body of men as I had ever seen together. Splendid addresses on the various subjects that affect foreign trade were delivered. Mr. Bernard N. Baker was to have addressed the meeting on, "The Necessity and Importance of an American Merchant Marine." At the last minute he notified the assembly that he would be unable to attend, so the committee asked me to take his place, which I did. The following is a stenographic report of my talk:

Report of the Merchant Marine Committee of the National Foreign Trade Council, Presented by Robert Dollar, Chairman

It goes without saying that the Fourth National Foreign Trade Convention desires to consider the American Merchant Marine from a business, rather than from a sentimental standpoint.

If any delegate desired to enter into a new business he would not wrap himself m the Stars and Stripes and make a speech. He would calmly analyze the chances of success in the particular field and then estimate his own resources and necessities. Let us consider, therefore, why the United States desires to go more extensively into ocean shipping. The National Foreign Trade Council has declared that an American merchant fleet should discharge the following functions: First: Increase the national income and domestic prosperity, through greater facilities for the sale abroad of products of the soil and industry of the United States; the importation of materials indispensable to life and industry; and, through freights collected from world commerce. Second: To maintain under the flag, communication with distant possessions. Third: To aid the national defense and maintain commerce during war, whether the United States be a belligerent or a neutral.

The world shipping outlook may be summarized as follows:

The position as far as the future of merchant shipping is concerned may be summed up under four heads:

1. War loss of tonnage.
2. Steps taken to remedy the decrease of tonnage.
3. Nationalization of merchant shipping in relation to international traffic.
4. Participation of American shipping in international trade after the war.

War losses

According to available statistics, England has lost some 12% of her deep sea shipping as a result of the war; while Germany has lost about 7.5% of hers, through mines or otherwise. The 13.4% of German tonnage now in the hands of the Allies has not been wiped off the register, nor is it necessary to take into consideration the 39.1% of German tonnage laid up in neutral harbors. In the case of Norway, the loss of shipping due to the war has been even greater than that sustained by England. The merchant shipping of the world to-day is probably only 85% or 90% of what it was when the war broke out, taking into consideration all the new tonnage built during the past two years, which is the smallest amount built for almost a generation.

Collectively, with this process of destruction, we must include some four and one-half million tons of shipping laid up to avoid the risk of capture, while at least another twelve million tons is in constant use by the Allies, in connection with the transport service. Altogether, it has been estimated that only slightly more than 50% of the whole mercantile fleet of the world is now available for peaceful trade, so that no great effort of the imagination is needed to understand the position as regards both the present level of freights and the prices which neutral ships ate commanding in the sale market. This will give you a general idea as to why freights are so high.

Remedying the Losses

The next question in order is, the nature of the steps taken to remedy the loss of that 10%, more or less, of the world's tonnage which has been destroyed as a result of the war. It is here that the greatest difficulty will be found in arriving at anything like comprehensive figures, upon which to base positive deductions.

In 1913, for instance, British shipyards turned out, approximately, 1,975,000 tons of shipping. Last year the output was reduced to 580,000 tons; but, concurrently, there was a proportionate increase in other countries, particularly in the United States, where, including the tonnage built on foreign account, some 560,000 tons of shipping were launched. In Holland, France, Norway and Denmark, last year's output was slightly reduced, owing to the difficulty of securing material; while little is known of what is going on in German shipyards. Japan and Holland, together, turned out about as much tonnage as the United States, and. adding the British total to that of all other countries, the total for 1916 is slightly above 1,820.000 tons of new ships —which is less than the output of the United Kingdom for the year 1913. The output of new tonnage throughout the world has been reduced by 50% since the beginning of the war.

According to the figures compared by the Bureau of Navigation of the United States Department of Commerce, not less than 1,428,000 tons of steel ships had been ordered from American shipyards on December 1, 1916; and, in the United Kingdom, according to the figures of Lloyd's Register, approximately 1,180,000 tons of shipping were in various stages of completion, and could be put into service within a few months, should the cessation of hostilities permit the employment of sufficient labor to push the work on these ships.

Figures are lacking as to the amount of tonnage under way in Germany, France, Italy, Japan and Holland; but, it is known that this tonnage is considerable and amounts to at least as much as has been ordered in this country; so that there is every reason to believe that, should hostilities terminate this year, the mercantile marine of the world, after another year, would show a net loss less than is now anticipated. In other words, it would have suffered from arrested development, a condition open to various interpretations, for the reason that, in years past, trade depressions were followed by terrible slumps in the shipping industry, so that any slackening in the movement of international traffic resulted in depriving ordinary cargo ships, or tramps, of a living wage, and forced many of them into idleness. This surplusage, therefore, will have been wiped out by the destruction wrought during the war and the slackening of shipbuilding operations, making the exploitation of overseas transports a less precarious industry than it has been since the last boom period of 1900, which was then brought about, wholly, by the enormous requisition of tonnage by Great Britain for the transport of troops and supplies to the seat of war in South Africa.

Government control of shipping

It would be extremely rash, however, to venture predictions concerning the maritime traffic situation of the world as ;t will find itself at the end of the war; chiefly, because the ultimate result is still a matter of speculation. At such times as these, when international trade is, as during the Napoleonic wars, a period held subordinate by the belligerents to the measures thought necessary to secure the advantage in war, the future is so dependent upon the future course of events, as to warn us to exercise the utmost caution, when venturing predictions based upon past events.

The war has been, and is still, a great benefit to the shipping of neutral countries. Thus, we have seen in our own trade, scores of Japanese, Greek. South American and other vessels, that formerly never ventured beyond the coast line of their own countries, arriving at our ports in search of coal, grain, foodstuffs arid other essential necessities. Similarly, our own so-called '"Coastwise" vessels have been eagerly chartered for the overseas trades and, a few days ago. two steamers, built for the Atlantic Coast trade, were chartered by a British steamship company to work on the New York and River Platte line, in the place of British tonnage that had been commandeered by the British Government.

One question which has been foremost in the minds of those who have recently participated in international ocean traffic, has been, the probable attitude of the belligerents toward neutral shipping when the war ends. It has been hinted that the system of government control of shipping now in force in the warring countries, would be continued after peace is declared, and, that steps would be taken by the Allies to exclude from their trade the ships owned by their former enemies.

It is idle to conjecture what is really at the bottom or what will be the result of the trade pact signed by the Allies at Paris, last year; but, it is inconceivableable that the nations which are now, in their own words, allied for the defense of civilization, will use the eventuality of victory for the purpose of enforcing a system of domination of the seas which, though once claimed as a right worth upholding, if necessary by force of arms, was given up voluntarily as a handicap upon the accretion of national wealth, through greater participation in international trade.

Restriction of the liberty of navigation must be paid for by those who would seek to drive others from the sea: and. historians are agreed, that it was only through her renouncement of the doctrine of Sovereignty of the Seas, and the repeal of the monopolistic Navigation Laws, that England secured for her shipping that position of superiority which it enjoyed at the beginning of the war.

Effect of controlled skipping

An object lesson n the practical working of nationalization of shipping is in evidence to -day. It is undeniable, that much of the tonnage scarcity existing in certain trades has been artificially created by the action of officials in control of shipping, who have ordered ships to proceed from one end of the world to another, unmindful of the fundamental principle that the proper function of shipping is to serve both ends of the trade routes: and, that ships cannot be shunted to and fro like locomotives, over the shortest circuit, without causing profound disorganization in the system of international transport which has been evolved by the natural process of operation of the law of supply and demand. Signs are not wanting that the public of the allied nations is beginning to understand that. Government control does not necessarily imply efficient handling.

In this country, we have heard the echo of Government control of shipping through the enactment of the Shipping Act, with its concomitant appropriation of $50,000,000 of public funds for the purpose of acquiring vessels. In this case, one problem will be the judicious expenditure of so large en amount of public money, without incurring the risk of a tremendous depreciation of the initial investment when conditions have returned to normal,

American shifting

The last phase of the problem of rehabilitation of merchant shipping after the war, is that which has to do with the probable amount of traffic that will be available when the guns are silenced, and the legitimate share of such traffic which may accrue to the American merchant marine.

The nations at war have piled up such a heavy burden of debt, that, for a long time, they will probably continue to impose upon themselves the program of retrenchment al present in force.

Of late, the percentage of American foreign trade carried in American vessels has increased materially, and the urgent question at the moment is, the devising of means, not only to the end of reserving for American shipping the percentage of American international trade which it has won; but also of strengthening its position in order that if the end of the war witnesses keener competition for maritime traffic, the American merchant marine will continue to enjoy that share of the world trade which it has already conquered.

This phase of the question is that which concerns us most deeply, both because an American merchant marine is required for national needs, and as a source of revenue for our people; and, because it is a vital element of the shipping problem, that no one section of it be developed without due regard for the economic conditions which are likely to influence its existence. The new American merchant marine, which is new in process of evolution, has not, perhaps, developed as rapidly as circumstances seemed to justify; but, it is well worth remembering, that the natural desire of the American public to venture more extensively into ship owning has been somewhat dampened by legislation which, although ostensibly conceived for the general benefit of the community, has nevertheless been interpreted as likely to handicap the chances of American shipping. The Seamen's Act is a case in point.

In all countries, a similar upward trend in the cost of ship labor has been witnessed and, for the time being, high rates have neutralized the disadvantage imposed upon American vessels; but, if it is desired that the American ships which are now exploiting some of the American trade routes reafirm in these trades after the war, it will be necessary that, after rigid inquiry, steps be taken to place the American ship on a footing of equality with any competing ship in the same trade. Such functions appear to have been delegated by law to the recently created Shipping Board and, if by reason of the Board's existence, it becomes possible for American shipping to trade on equal terms with the foreign ships that come in ballast to these shores to seek cargoes for distant markets, there will have been set in motion machinery that will prevent the recurrence of that period of stagnation existing before the passage of the Panama Canal Act, when the arrival of an American ship at any port in South America south of the Spanish Main, was enough of an event to draw comment from the vernacular newspapers.

Peculiarities of the American traffic

When studying the merchant marine problem in its particular relationship to the ownership and operation of tonnage under the American flag, t must not be overlooked, that there exists, in our foreign trade, a serious deficiency from the traffic point of view, m the fact that the normal tonnage of American exports is about twice that of imports, so that there exists, at all times, a greater demand for tonnage to carry exports, than is usually to be found disengaged m the ports of the United States.

In general, it can be predicted that, as soon as our imports of raw materials have increased in such volume as to solve the vexed problem of return cargoes, there will have been evolved a condition, that will not only be of great help in the development of the American merchant marine, but of many of our competing industries as well; for the reason that, the greater volume of imports will be a guarantee of the steady flow hither of a large number of ships which will be available at lower rates of freight than has been the case in the past, when so many ships had to make the voyage to these shores in ballast in order to load our exports.

It may be regarded as axiomatic that, even when under such circumstances, traffic will be found for an American merchant marine only if it is able to offer both exporters arid importers the same service for the price at which foreign ships are willing to undertake it. This traffic will not of necessity be regularly to and from the United States, because on several of the trade routes over which our exports travel, no return cargoes of any kind are available, so that American ships will serve the commercial interests of other nations as well as of ours. Obviously, it is impossible for any nation to trade exclusively in its own bottoms, because. ;n such a case there would be no return cargoes and the ships voyaging empty on one leg of the journey could not perform the service for the same price as when the cost of transportation is figured on the assmuption of carrying paying cargoes both ways. Therefore, American traffic stands peculiarly in need of the "'tramp," the very nature of whose existence is to serve the commerce of all the world, carrying cargoes for whatever destination is offered, in order to avoid the deadening expense of returning home in ballast. Normally, about 40% of the carrying power of the British merchant marine is employed constantly in service between foreign ports, wholly outside the United Kingdom; and, in average years, only about 55% of the entries and clearances at British ports consisted of British tonnage.

England's example may serve as an illustration of the great economic fact that, no nation can transport all of its foreign commerce in its own vessels, for we must always reckon with the unnatural desire on the part of our foreign customers, like ourselves, to possess a merchant marine, so that, in all cases, care will have to be taken to allow such foreign ships a sufficient margin of traffic from our coasts; especially in view of the fact that such of that which we export is the property of the foreign purchaser even before it has left this country.

Vast tonnage needed

From these premises it has been adduced that, there is every reason to put forward efforts enabling an American merchant marine to carry from 50% to 60% of our total foreign trade—speaking in terms of bulk, not value. It has also been calculated in a statement submitted in May, last year, by the National Foreign Trade Council to the Merchant MarLie Committee of the House of Representatives, in connection with the passage of the Ship Purchase Bill, that between six million and ten million tons of ships of all sizes and types would be needed to discharge such functions as have been alluded to above. This by no means implies that such an amount of tonnage is tc be created anew. In the first place, the capacity of the shipbuilding industry of the whole world would not be sufficient to provide so many ships in a decade, but, it. does mean that, provided inducements are offered Americans to operate tonnage under their own flag, there is traffic already in sight at our very doors, for a fleet approximating half that of England when the Great War broke out.

To sum up, this is the situation: The traffic is here, and more traffic may spring up as a result of more intensive exploitation of our coal mines, increased imports of ore and nitrates, and greater expansion of our export trade in manufactured goods. From the transportation of about one-half of this traffic, not only can our people derive a very large revenue, which will be a welcome addition to out national wealth, but the ability of the nation to defend itself against foes will also be well served by the ownership of so large a fleet. The investment that would be represented in such a fleet amounts to probably ten times the $50,000,000 appropriated by the Shin Purchase Act.

Therefore, the duty which lies before the Shipping Board, created by the same law, is not so much the expenditure of that appropriation under the dangerous conditions existing at present, but, the evolution of a policy enabling American ships to compete on equal terms with those that have in the past carried the preponderating share of our foreign commerce.

Somebody must pay

Either by the leasing of the government owned vessel to private enterprise or by government operation, the Shipping Act embarks the United States in an industry, normally costing more to conduct in the United States than under foreign flags. Under normal conditions of peace it can scarcely be expected that private companies will undertake the operation of government ships, unless the rate of lease or charter is sufficiently lower than the market to offset higher American operating cost. Somebody must pay the difference, and under the proposed policy 't will be the taxpayer, just as surely and completely' as under a subsidy policy. If, then, government aid is extended only through the leasing of government owned vessels, the American flag m foreign trade may become a government monopoly, except for such exporting enterprises as may desire, as a matter of policy and protection, to own and operate vessels for the carriage of their own goods.

It is not generally realized that the authorization for a $50,000,000 bond issue to give effect to the Shipping Act is the most unrestricted appropriation ever made by Congress, for no regulations are laid down. A Public Building bill always specifies the location and limit of cost of post offices and customs houses. A River and Harbor bill does the same for engineering works. But, the Shipping Board is empowered to build, buy or lease vessels, and to lease or sell them, and with the funds thus derived, it may build, buy and lease more, and again lease or sell them. The way is open for the government to assist private enterprise by chartering vessels to individuals or companies at less than the market rates, but, a distrinct danger lurks in the possibility of political influence being exerted to determine the recipients of such aid. The Shipping Board will require a maximum of independence and vision to resist such influence, for it is unlikely that the public will ever consent to sufficient appropriations for the government construction or purchase of the six million to ten million tons, necessary to render American commerce reasonably independent of foreign transportation.

The government control of European shipping during the war has led to some projects for a similar control during the reconstruction period, and permanently thereafter; this has created a rather academic apprehension that European merchant fleets may not, with the return of peace, be again so thoroughly at the service of American commerce as before the war, but, that by some co-operative policy, the various belligerents will use their shipping only for the encouragement of their own commerce. This overlooks two important facts—First, that transportation from, aud exportation to, the United States, will be the most important element of European commerce; and, second, that when ships, now impressed in government service and immobilized, are released, there will probably be more ships than freight, and unrestricted competition will serve the rational interest of all countries, better than European government control.

The first duty of the Shipping Board, obviously, is to acquaint the American people with the fundamentals of ocean transportation, especially as relates to American foreign commerce. And its second duty is, to make recommendations to Congress which will permit the development, by private enterprise, of a merchant fleet sufficient to give the United States what, for many years, economic and legislative construction have denied it—A share in the ocean carrying trade of the world.

A policy consisting of a few government steamship lines will not be a solution of the problem, in which probably, above all others, the American people are interested.

The United States Shipping Board will be accompanied in its labors by the earnest wishes of the American business public, that its labors may result in a broad and constructive policy. To this end it is the duty of every American citizen engaged in foreign trade, to give his cordial co-operation and best information to the Board.

Commercial and industrial organizations should be encouraged to study this question in his broadest aspects as an industrial proposition.

The Merchant Marine Committee of the National Foreign Trade Council is conducting a continuing work of investigation: the results of which, from time to time, are made public. Pending the organization of the Shipping Board, and an indication of its interpretation of the Shipping Act and the policy it proposes to pursue, the Committee at this time deems it inadvisable to make further recommendation than that all business interests co-(operate to the best of their ability with the Shipping Board, and that the Board itself lay the foundation for a policy which will encourage the private endeavor which alone can produce and permanently maintain, a fleet adequate for the carriage of a greater share of our own and the world's commerce.

Committee of the Merchant Marine, National Foreign Trade Council.
Robert Dollar, Jamfs A.. Farrell, P. A. S. Franklin.

This ends the Report of the Committee, but I have a few-remarks to make that I think might be of interest. As to the personality of the Board, I would say this: I know them. They are all men of the highest reputation and the highest character; but, when I want to get a suit of clothes, I don't go to a shoemaker. There is a lawyer on the Board, there is a lumberman and there is a railroad man, and there is one shipping man and one vacancy. The Seamen's Union has done its utmost to prevent the ratification by the Senate of the shipowners' appointee, for the reason, they say, that he would know too much about shipping; and they don't want him. The difference between our Shipping Board, and the Shipping Board in London that controls more than half the steam tonnage of the world, is this: there, they appoint men who are actively engaged in shipping; while our men had to quit the business they were in before they could qualify- for a position on the Shipping Board. They recently appointed a man there, who is one of the largest shipowners in Glasgow; and he and another shipowner are practically running the entire shipping business of England.

Mr. Chairman, whenever I have talked long enough, you tell me to sit down. I should like to speak of the conditions previous to the war. after the war is finished, and present conditions. As I said, anybody can run a ship to-day and make lots of money out of it, but I am going to take you ahead to the time when we are going to get down to the keenest competition the world has ever seen.

1 want to say to you that, in foreign shipping, we are in competition with the whole world, and we meet the keenest and sharpest men in the whole world in our competition. It is certainly a man's job.

Just to show you the handicaps American ships have. In talking at New Orleans, I didn't speak of this and some of the members-—especially those from the Middle West— said they would like to have known about the handicaps. I have not time to go into them at any length, because there is a whole, string of them put in by the Government.

Take the extra measurement of a ship—The Americans measure the capacity of a ship larger than does any other nation. Therefore, when our shipping goes to a foreign country, it pays from 20% to 30% more tolls to the foreign government than any other ship. That amounts, in a ship of 8,000 tons, dead weight, to about $5,500 a year.

The extra cost of inspection—We have to lay up our vessels to have them nspected. In foreign countries, they say this: "We want to inspect your vessel, are you ready? What have you ready?" We tell them what we have ready, and they give us a Certificate of Inspection for a certain part; we pass on to the next port to have the inspection completed. This is done so that there will be no delay. But, with our Government, they say: "Stop and wait until we can inspect your ship." I had a ship in Honolulu at one time on which the inspection certificate had expired. The ship was held up. There was no Inspector in Honolulu, the one nearest being at San Francisco. After telegraphing to Washington and waiting for some time, we finally obtained the consent of the authorities to have them send the Inspector to Honolulu. In the meantime our ship and crew were waiting for the Inspector at a cost of about $3,000 a year.

Then. the difference of wages—I took three ships, I have the records in my books; one was an American ship, one a British ship and the other a Japanese ship. The Japanese ship we chartered, but the other two I owned. The wages on the American ship were $39,240 a year; the wages on the British ship were $15,696 a year; and the wages on the Japanese ship were $9,324 a year. So there is a difference in the wages; and, when we get right down to a keen competition, there is the kind of competition that we are going to meet along with the other handicaps we have.

Mr. Furuseth, in planning the Seamen's Bill, said his plan was to get every sailor that came to an American port to desert from his foreign ship, and then hire him over again, at the American wages. In theory that was fine, but in practice it wasn't worth a cent. He forgot that if a sailor deserts a Japanese ship in a foreign port, when he returns home he is put into jail for a year. Now, Mr. Furuseth made the proviso in the Bill, that the sailors of each nationality should ship on vessels of their own nation, or they would he taken up by our immigration authorities and deported; but, those who would ship on a Japanese vessel and go back to Japan, would go straight into the calaboose on arrival.

Now, what I have to say, is this—The shipowners do not want any subsidy. Because, a subsidy, as you know, to Congress, is like showing a red rag to a bull; but, if other nations are paying their sailors $20.00 a month and the American wage is $50.00 a month, then let the Government pay the sailors the $30.0(1 a month difference-—to every American who ships. That will not be a subsidy—that will only be a little help to the poor men.

For the benefit of you men not in the shipping business, I will say this: when you hire a man. the bargain is just between you and him; you hire him and he works for you. Not so in shipping. When we hire a crew for a ship, we have to take the men before a United States Shipping Commissioner, who explains to the men the agreement, and each man signs the shipping articles. Then, when it comes to pay him off. we are not permitted to pay him. We take the money and give it to the Shipping Commissioner, and the Shipping Commissioner pays him. You see, gentlemen, that the Government comes in between to keep the wicked shipowner from "doing up" the poor man.

A question that you gentlemen no doubt have often asked yourselves is: What difference does it make to us whether we ship our goods in a foreign or an American ship, provided the rate of freight is the same? It shouldn't make any difference; but, I will tell you where the difference comes in. Take a shipowner running a ship from an American port; he is the best drummer of trade you can get, because, as I have explained to you, he will go to any extreme to get a cargo that will bring his ship back to his own port, and to try and help the commerce of his port. But, if I were living in London or Liverpool, do you think I would be pulling for this United States? Not at all! It is only because I live in this country that I am a drummer for the trade of this country, and try to keep my ships going. As an illustration. I cited a case where .we sent a ship clear around the world to get back to our own country. That is the great advantage of having our own ships.

Another thing—if a ship s to come back in ballast, you gentlemen are going to pay just about double the amount for the freight going outwards. A return cargo would cut your freight pretty nearly in two.

Now, the Emergency Act was about the only thing that was passed by Congress that amounted to anything at all in the way of helping American shipping, and that was drafted by a committee of this organization. But, the ink had hardly gotten dry on the President's signature, when down came the La Follette Bill, which practically crushed us out of existence. I have not time to go into the La Follette Bill; it would take half an hour to tell you about 1% and you would be tickled to death with the explanation, if I only had time to give it. That was by way of helping the American Merchant Marine—Over the left.

I will read the figures from the Report of the Department of Commerce, of last May—just try and keep them in your mind.

Before the war began the American tonnage of the Pacific Coast was 26.10% of the whole tonnage. In May 1916, after the beneficial La Follette Bill had gotten in its deadly work, it was 1.97%. Shall I read those over? Before the war, 26.10%, and after, 1.97%; after—you know what.

The Briiish tonnage before the war was 29.38%, and now, in May, it: was 37.09%.

The German tonnage was 18.47%, and of course that was wiped out.

Then Japan- -I want you to take particular notice of this, gentlemen, and take it home with you, if you will just make a note of it. Japan, before the war, did 26.05% of the Pacific trade, and in May last, 50.90%, That is the effect of the Seamen's bill. You will notice that the Americans went down to 1.90%, and the Japanese ran up to 50.90%; and, if I had the statistics up to the first of January, it would show an increase for the Japanese up to over 60%. It would not show any decrease for the Americans, because we were right down to nothing.

Then the Dutch came in. Before the war they didn't do a thing; but, after the war, they are doing 10% of the business.

These figures are very significant, taken in connection with the legislation that is now going on.

I want to say to you gentlemen, that I am not making a political speech. The Republicans did their worst to hurt the American Merchant Marine, and the Democrats were only successful because they were better at figuring—and, they were able to do us up worse than the others. You see, there is no politics in this at all.

I will give you just one more illustration. The old Pacific Mail Company paid no dividends for thirteen years. How would you like it? Thirteen years between drinks. Think of it! Then the Seamen's Act came down on it, and if it had stayed in business, it would have had to pay out $600,000 more a year.

The new Pacific Mail Steamship Company had an experience which illustrates more clearly the operation of the Seamen's Act. The company employed on a ship an American crew. The act compels the captain to pay the men half the wages they have earned at every port. The first port being Honolulu, the men got their money and forgot to come back to the ship, thereby delaying the sailing a day. At Yokohama, the same thing was repeated, and the ship had to sad without a full crew and had to pay some of their fares on the railroad to take them to Kobe. A reception was being held on the ship to Japanese merchants, when a free-for-all fight occurred from the effects of whiskey. This so exasperated the company that it hired a Chinese crew and paid the passage of the Americans back home. So much for the people making laws, when they have no idea of what the results will be. The British laws are most favorable to shipping, and as a result you will find British ships in every large port of the world, whereas the American ship is only-conspicuous by its absence.

The Japanese. I will just say. are advancing their trade to South America, it having increased during the past year about 50%.

There is just one thing more, and that is this: With the abnorrmally high freight rates now being paid, where shipowners are making money as never before, the Americans are out of it and the other nations are in it. Japan has increased her wealth so much,—her balance of trade had about balanced—that every steamer leaving San Francisco has practically, from a million to two millions of gold, the balance of trade now being very much in her favor. Gentlemen. I thank you.

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