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Memoirs of Robert Dollar
Vol. 1 - Chapter Eleven. Personal Comments on Japan

The following is an exact copy of a letter that I sent our San Francisco office while on this trip. It will serve to show the great change that has come over Japan during the past eight years.

Osaka. Japan, November 15, 1908.

The next day Saturday, it was raining, making it disagreeable to get around. However, a great many of our party visited the Stock Exchange and Mint, where a special cash medal commemorative of then visit was presented to each. Unfortunately, I was laid up with a terrible cold. Many of the factories were visited. This city is the manufacturing center of Japan. In certain lines there is more doing in Osaka than all the rest of Japan put together, principally in cotton. They also supply the whole. Orient with matches, but every manufacture is represented here.

They have built a good breakwater, taking in ground enough to make a very large harbor, but it all requires to be dredged out, and while they are working at it, it is on a very small scale on account of the lack of money. Taxation is so high that they are practicing economy in everything, and work is cut down all along the line. It is most unfortunate that such an important and necessary work should lag. There is water enough for a few ships of deep draft; you will recollect before the war that the steamer "Stanley Dollar" took a full cargo of barley here. There is no reason why Osaka should not eclipse and take most of the trade from Kobe ("twenty miles distant) as Osaka is where the raw material is destined. They bought over thirty million dollars worth of raw cotton last year. The manufactured articles are shipped out principally to China, but. a good deal goes to our country. So Osaka should and will be the principal seaport of Japan in time.

They are very well situated to handle freight. The whole city is a series of canals and the lighter goes directly to, or from, the factory and warehouses, two men moving one hundred tons by poling the boats as easy as one ton can be moved in our city, and hundreds of tons will be moved at half the cost we can move one ton. It occurred to me what a pity* it is that our Channel Creek has not been extended and an outlet to the Bay made near the Union Iron Works, thereby giving us great facilities for warehousing and handling freight. It looks to be a great disadvantage in the Orient that our big steamers have no wharves to go to, but when we consider the quick dispatch we get from the multitude of lighters which come alongside, and then consider that those lighters take the freight right to where it is wanted without handling, t is easy to see the great advantage this system has over discharging at a wharf and hauling at heavy expense everything from there to the factory or warehouse.

This city is a great hive of industry, and when we consider that the very highest paid mechanic only gets 75c gold a day and girls from 10c up to 25c, it is no wonder that they are able to work up an enormous trade, and they will hold it, too. To be sure, since ten years ago, wages have doubled, but they can still take a further jump before they come in competition with our high paid labor. So to compete we must look to branches of manufacturing where labor does not count but where machinery takes the place of labor. Then again the Japanese are in every country in the world looking for improved machinery and ways of bettering their manufacturing. So it is not an easy matter to foresee what changes are going to take place.

One thing that is grinding down Japan is the very high taxes they are groaning under to pay their war debt interest. It is certainly a terrible load they are staggering under. This has raised the price of living, they claim, 10 per cent in the past two years. However, the poor people get on with very little rice and fish, a little calico, wooden shoes and bare heads. Most of the good rice is exported, and inferior, cheap rice is imported.1

They are paying great attention to education. I notice many large schools have been built since my last visit, and as education is compulsory all the younger generation is m school and a very large number are learning English.

We left Osaka in the evening, on the electric cars, and had a great ovation at every station along the road. We only stopped at a very few, but the crowds were there all the same. At Kobe, the Governor of Hiogo, the Mayor and civic authorities met us at the station and welcomed us to their city. The native city was decorated, but not nearly as well as any other place we visited. There were crowds on the streets and a great crowd at the station, but in the foreign part of the town there were no signs of welcome of any description. So it was very plain, as far as the English, Germans, et ah, were concerned, we were not wanted. In fact, personae nan gratae, and in conversation later on I found they threw cold water on our reception, and said the Japanese were not glad to see us, that we were not welcome, and that out of courtesy the Japanese were keeping up appearances. etc., etc.

However, there were enough old men amongst our number who had seen lots of the world and no people could deceive us for any length of time, and no one can make me believe that the common pec pie of Japan are not in dead earnest; and the merchants are to be so greatly benefited by our friendship that they can't help but be friendly, but there is no influence or interest that would make the working classes friendly to us except clearly out of their hearts. At all events nothing could convince us to the contrary, and our visit through the country has stirred up more good feeling than if our country' had sent a half do/en fleets, and I think it a very good sign that the Europeans did not take kindly to our visit, as they fear to be hurt by the after results, which I for one feel sure will be greatly to the benefit of our nation. So I think the money we have expended will be the best investment we have ever made for our country

Next day the Nippon Yusen Kaisha fitted out one of its best steamers and invited the prominent Japanese of Osaka and Kobe (I think there were probably two hundred and fifty on board) to accompany our party on a trip, They steamed down the Inland Sea and back; had a great banquet, brass band, and everything that would add to our comfort and enjoyment. We had a splendid time and with all, a very profitable one, as we had plenty of time to get acquainted with the carious gentlemen, and much benefit was derived from a free exchange of views. In my line I had some interesting talks with the general managers of the Nippon Yusen Kaisha, Mr. Kondo and Mr. Harada: also Mr. Kafuka of the Osaka Shosen Kaisha who are building five steamers for the Puget Sound, Milwaukee & St. Paul route. They have to commence next May and won't be ready, so are chartering steamers in England to fill in until their own are completed. The Kawsawak- Dock Company built two, and the Mitsui Bishi Company at Nagasaki three; one or more are turbines, but they will only do about thirteen knots—economical steamers.

They are all very much troubled over the action of the Interstate Commerce Commission, as they don't know where they stand, as the proportion they will get for the steamer haul will be only $2.00 a ton measurement on matting Everything else is in about the same proportion. This is impracticable, but I told them I could not see why Jim Hill and the Pacific Mail could not carry for nothing and get the pay out of the rail haul, and then they would have as much as before, but the Japanese immediately asked. "Where do we get off on a deal of that kind?" I replied, "You are only getting half of what you got before and the railroads are getting more than they ever hail;" so there is a great uncertainty of commerce. They fall back on the subsidy. but that won't run their vessels alone. The builders' subsidy is not as good as it appears, as they have to import all the steel and pay 25% ad valorem duty on it. This cuts quite a hole in the builder's bonus. The subsidy figures out as follows: Say on a 7000-toii dead weight steamer, estimating her gross measurement at four thousand tons:

Builder's Bonus 10-Knot Boat- Gold Dollars

Gross tons, 4000  @ $10.00....... $40,000.00

Engines say 1500 L. H. P. @ $2 50............ 3,750.00

Total $43,750.00

The shipbuilder would have to pay in duty approximately $20,000.00.

A steamer of the above size on the round trip run from Japan to America. 9000 miles @ 20c, $1800.00: say four trips a year, $7200.. This is operating subsidy.

But vessels of great speed profit much more, as for every knot over 10. add 20%; so the subsidy on a 15 knot steamer would be double.

After a ship is five years old the subsidy is reduced 5% a year, A foreign-built ship gets half of the above provided she is owned by Japanese; over five years old she gets nothing. They are determined to get a large merchant marine, thinking that their nation can not be truly great without one. It is certainly commendable the efforts they are making when their country is burdened by a load of taxation which they can scarcely stagger under, and they are paying out large amounts every year to keep up what they have and to build more. Compare that with our great, rich nation. Our Congressmen pass laws that make it almost impossible to operate the few ships we have. Since we left home we have not seen one American flag on a merchant ship, and perhaps won't see one until we get back, unless it might be on a Pacific Mail boat.

Times have been very hard in Japan, but they all report a slight improvement. So the bottom has been reached and it is quite likely that business will revive all over the world.

At home, since Mr. Taft and a Republican House and Senate are elected, our people will have more confidence and no doubt the revival will be faster in our country than in most others.

Kobe harbor is the same as when here last. There is lots of room in the bay, but when a storm comes up no work can be done. Shipping is scarce, not more, than half the usual number. I noticed they were nearly all large steamers, not many small ones. Evidently the hard times had squeezed the small ones out.

The transportation facilities afforded us were of the best. A special train was provided for us on all occasions with a dining car attached, and all meals were furnished free of charge, liquors and wines also being furnished. I am very pleased to report that I never saw so little wines and liquor used on any trip of this k id, seeing it was furnished free, and they were very much surprised that practically none was used. The street car companies always provided special cars whenever they knew a few of us were going anywhere.

We left Kobe on the "Kosai Main," Nippon Yusen Kaisha boat, for Shanghai via Moji and Nagasaki, November 7, 1908.

(Signed) Robert Dollar.

Our party wound up the trip by attending the Emperor's birthday party. The review of twenty-five thousand troops was a great sight to see. So ended a visit, the like of which, I am quite safe in saying, no foreign party ever received from any nation before.

Mrs. Dollar and I left the party and proceeded to Shanghai, where we remained two weeks attending to business. Our offices at this time were at the corner of Sezcbuen and Nanking Roads.

I was invited to attend a meeting of the Chinese Chamber of Commerce and explain to them about our visit to Japan. I told them of the great benefit it had been to both the Japanese nation and the United States. I stated that when I returned to America I would see whether it would not be possible to get up a party to visit China along the same lines on which we had visited Japan.

We then proceeded to Hong Kong and remained there a week. This was a very busy week as I had a great deal to attend to. From there we sailed on the "Yawato Maru" for Sydney, Australia. We had a very rough passage across the China Sea and the ship sustained some damage so we were delayed a few days in Manila for repairs.

I looked over the situation here and found many changes had taken place since I last visited it seven years ago. At that time the Government became possessed with the insane idea that the higher the tax they could impose on shipping, the better. This seems remarkable, since the port of Hong Kong, their next neighbor, admitted shipping free. The result was that vessels went to Hong Kong and gave Manna the go-by, causing the Manila merchants to pay double the freight Hong Kong had to pay. But shortly before tins visit the authorities had gotten their eyes open and had reduced there charges almost to their competitor's level, the result being the reduction of freights, and vessels now go freely to Manila

Another serious drawback was the very slow discharge. A vessel took more than twice as long and the cost is double to discharge at Manila compared to any Chinese port All this is changed now. Though it costs more to stevedore, the dispatch if much better than it was, and Manila now begins to compare more favorably with her competitors. Furthermore, I found a desire 011 the part of the Government as well as the merchants to encourage shipowners to send their ships there, The Government discovered that shipowners did not have to go to ports unless they would be assured of the same treatment they received elsewhere. The result of all this change has been a tremendous increase in the commerce of the Philippine Islands.

The change impressed me so favorably that I decided to look into the Philippine trade, as Mr. Taft practically told me on his arrival to be Governor, that American shipowners were not wanted. He had the foolish idea that the poor Filipinos would be able to furnish all the ships they wanted, although they neither had the experience, money nor get-up (All this has been fully demonstrated of late years. Where we are not wanted is a great place to keep away from, which I did from the Philippines for seven years, but now we are back and doing a very satisfactory business.

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