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THE DECAY OF OUR OCEAN MERCANTILE 
 MARINE: ITS CAUSE AND CURE. 
 
 WILL SUBSIDIES BRING BACK OUR SHIPS ? 
 
 The time has come, when the cause and cure of the extra- 
 ordinary decline in the ocean mercantile marine of the United 
 States ought to be no longer a matter of doubt and contro- 
 versy ; for the experiences involved have been so thoroughly 
 investigated, are so unquestionable, and admit of such clear 
 presentation, that there is nothing to prevent any citizen of 
 ordinary intelligence from readily understanding the whole 
 situation and arriving at definite and satisfactory conclu- 
 sions, without resorting in the least degree to hypothesis. 
 As it is evident, however, that there is not as yet a satisfac- 
 tory understanding and agreement of opinion in respect to 
 this subject, on the part of the American public, it is expe- 
 dient to present anew the record of our experience and the 
 salient points of the present situation. These are in the 
 main as follows : 
 
 PERIOD OF GROWTH AND PROSPERITY OF THE OCEAN 
 MERCANTILE MARINE OF THE UNITED STATES. 
 
 So long as the people of the United States controlled the 
 best and cheapest material (wood) for the construction of 
 _ships, and through long experience had become most skil- 
 ful in their building and navigation, so long did the Ameri- 
 can mercantile marine continue to increase and prosper, 
 even in spite of many disadvantages, in a most wonderful 
 manner. 
 
2 THE DECA Y OF OUR OCEAN MERCANTILE MARINE. 
 
 The aggregate tonnage belonging to the United States in 
 1 86 1 was but very little smaller than that of Great Britain, 
 and nearly as large as the entire tonnage of all maritime 
 nations combined, with the single exception of Great Brit- 
 ain. American-built and -manned ships in 1856 not only 
 carried more than 75 per cent, of all the things (imports 
 and exports) that came in and went out of the country, but 
 more than 50 per cent, of the tonnage of the United States 
 was exclusively in foreign employ, — carrying cargoes, at large 
 profit, from foreign ports to foreign ports, for foreigners, to 
 be used by foreigners, — and in which business Americans had 
 no direct interest but to receive freight money, to be sent 
 home and added to the productive capital of the country. 
 
 PERIOD OF DECLINE AND DECAY. 
 
 Extraordinary as was the growth of the American mer- 
 cantile marine, its decline and decay have been even more so. 
 
 Thus, in 1856, as before stated, American vessels trans- 
 ported 75.2 per cent, of the value of all the goods, wares, and 
 merchandise exported from, and imported into, the United 
 States. In 1888 they transported only 13.48 per cent., and 
 this substitution of service is progressing so rapidly, as to 
 portend, at no distant day, the almost entire disappearance 
 of the flag of the United States, as borne by vessels engaged 
 in foreign commerce, from the ocean. Out of 72,276,000 
 bushels of grain exported from New York in the year 1881, 
 not one solitary bushel was carried in an American vessel. 
 Between the years 1878 and 1887, the ocean tonnage of the 
 United States declined in a greater ratio than that of any 
 other maritime nation. 
 
 CAUSES OF DECAY AND DECLINE IN AMERICAN SHIP- 
 BUILDING AND SHIP-USING. 
 
 The decline in American ship-building, and in the Ameri- 
 can carrying trade upon the ocean, did not, as is often 
 
THE DECA y OF OUR OCEAN MERCANTILE MARINE. 3 
 
 asserted and somewhat widely believed, commence with 
 the war, and was not occasioned by the depredations of the 
 Confederate cruisers. These agencies simply helped On a 
 decadence that had previously commenced ; the primary 
 cause of which was the substitution of steam in the place of 
 wind as an agent for ship propulsion, and of iron in the, 
 place of wood for ship construction. These substitutions 
 passed from the domain of experiment to that of fact about 
 the year 1837; and the merchants and mechanics of Eng- ; 
 land, speedily recognizing that through these changes the 
 advantages enjoyed by the Americans so long as vessels were 
 built of wood and propelled by sails would be neutralized, 
 with characteristic Anglo-Saxon enterprise, and without any 
 co-operation from government, went speedily to work to 
 make the most of the new conditions, and built, launched, 
 and operated the first ocean steam and iron vessels. 
 
 In the first respect, namely, the application of steam to 
 ocean navigation, the Americans were not lacking in 
 shrewdness and enterprise. They waited until English ex- 
 perience had proved the fact to their full satisfaction, and 
 then embraced the idea so eagerly, and turned it to practi- 
 cal account so rapidly, that the foreign steam-tonnage of 
 the United States, which really commenced to exist in 1848, 
 nearly equalled in 185 1 the entire steam-tonnage of Great 
 Britain, of longer growth, and continued to increase regu- 
 larly and largely until 1856. But between 1848 and 1855, 
 the world had acquired some additional information. It 
 had learned that for all practical purposes an iron ship was 
 superior to a wooden ship, and in the long run, cheaper. 
 The immediate result of this was, that the great business of 
 building wooden ships in the United States for sale to for- 
 eigners began to decline ; falling off from 65,000 tons in 1855, 
 to 42,000 in 1856, 25,000 in 1858, and 17,000 in i860; so that 
 if the war had not occurred, it was certain that this branch 
 of domestic industry would be substantially destroyed. 
 
4 THE DECAY OF OUR OCEAN MERCANTILE MARINE. 
 
 Again, although warned of the consequences in the most 
 remarkable and prophetic manner by those most conversant 
 with the situation,* the Americans, nevertheless, continued 
 to use wood exclusively for the construction of vessels. 
 They built their ocean steamships of this material, and they 
 continued to use the paddle-wheel, when England was 
 abandoning it for the screw. The further result was, that 
 the total tonnage of every description built in the United 
 States declined from 583,450 tons in 1855 to 378,804 tons in 
 1857, and 212,892 in i860, a reduction in five years of 68 
 per cent. ; and our ocean steam-tonnage, which in 185 1 was 
 nearly equal to that of Great Britain, so dwindled away, that 
 in 1860-61, before the outbreak of the war, there were no 
 ocean steamers, away from our own coast, anywhere on the 
 globe, except perhaps on the route between New York and 
 Havre, where two steamships may have been in commission 
 in 1861, but were soon withdrawn. 
 
 Had matters been allowed to take their natural course ; 
 had Americans been allowed simply to take the advantage 
 of the world's progress which was taken by their competi- 
 tors ; and had not a subsequent restrictive commercial 
 policy made foreign trade to American merchants almost 
 impossible, it is certain that, even in spite of the war, there 
 would have been no permanent material decline in the 
 American shipping interest, and no condition of things to 
 bewail, such as exists at present. But matters- were not 
 allowed to take their natural course. The means and appli- 
 ances for the construction of iron vessels did not then — 
 1855-60 — exist in the United States ; while England began 
 to construct iron steamships as far back as 1837. The 
 facilities for the construction of steam-machinery adapted 
 to the most economical -propulsion of ocean vessels were 
 also inferior in the United States to those existing in Great 
 
 * See remarkable letter of Capt. John Codman contributed to the N. Y, 
 Journal of Commerce in the spring of 1857, Wells' " Merchant Marine," p. 51. 
 
THE DECA Y OF OUR OCEAN MERCANTILE MARINE. 5 
 
 Britain. Unwise conservatism, antagonizing the adoption 
 of new methods and ideas, contributed in part to this result. 
 A protective tariff on iron, which enhanced the price of this 
 metal in this country to at least 24 per cent, in excess of its 
 average price in Great Britain, obstructed its use and ren- 
 dered the construction of iron ships and steam-machinery on 
 terms of equal cost with Great Britain an utter impossibility, 
 even had the appliances for their construction been pro- 
 vided. And, finally, a provision of our navigation laws, 
 enacted with a view of protecting American shipping, abso- 
 lutely prevented citizens of the United States, interested in 
 ocean commerce, from availing themselves of the results of 
 British skill and superiority in the construction of vessels, 
 when such a recourse was the only policy which would have 
 enabled them at the time to hold their position in the ocean- 
 carrying trade in competition with their foreign rivals, and 
 afforded opportunity for adjustment to the new conditions. 
 All other maritime nations found themselves at the same 
 time under the same disabilities as respects the construction 
 of iron vessels as the United States experienced. Neither 
 France, Germany, nor Italy had suitable ship-yards, or the 
 tools and appliances, or the skilled workmen for so doing. 
 But no one of them adopted the policy of the United 
 States. On the contrary, taking a practical common-sense 
 view of the situation, and setting sentiment aside, they 
 concluded it would be the height of folly to permit a 
 great and profitable department of their industries to be 
 impaired or destroyed, rather than allow certain improve- 
 ments in the management of its details, because suggested 
 and carried out by a foreign nation, to be purchased and 
 adopted. And they, therefore, virtually said to their own 
 people, " If England can build better and cheaper ships for 
 ocean commerce, and will furnish them to you on terms as 
 favorable in every respect as are granted to her own citizens, 
 and if your private judgment and feeling of self-interest 
 
6 THE DECA Y OF OUR OCEAN MERCANTILE MARINE. 
 
 prompt you to buy and use such ships, the state will inter- 
 pose no objections to your so doing." And the merchants of 
 these maritime countries, adopting the course which seemed 
 best to them under the circumstances, went to England and 
 supplied themselves with ships and steamers of the most 
 approved patterns, and sharing with England the monopoly 
 of owning and using the same, have never had any such 
 results as the United States have experienced ; but, on the 
 contrary, have seen their commercial tonnage and carrying- 
 trade on the high seas largely increase ; and if their shipping 
 interests have since experienced any vicissitudes, they have 
 not in any one instance been referred to influences even 
 remotely connected with the liberal policy that was adopted. 
 Next in this history came the war, which helped a decad- 
 ence in our mercantile marine, which, as has been shown, 
 had already commenced. But the influence of the war after 
 its termination would have been but temporary on this as 
 it was on other of our great industries, but for the continu- 
 ance and extension of a national fiscal and commercial 
 policy which made it more difificult than ever for an American 
 merchant to build or use ships as cheaply and effectively as 
 his foreign competitors, and which also practically destroyed 
 the business upon which an ocean marine must depend for 
 profitable employment, or even existence. 
 
 THE POLICY OF THE UNITED STATES ANTAGONISTIC TO 
 FOREIGN COMMERCE. 
 
 To appreciate fully the truth of this statement it is neces- 
 sary to bear in mind, first, that foreign commerce is the 
 exchange of the products of one country for the products 
 of other or foreign countries ; and, second, that it is the one 
 great characteristic feature of the protective policy to re- 
 strict or prevent such exchanges. To prove there is no mis- 
 take in this second proposition, attention is asked to the 
 following evidence : 
 
THE DECAY OF OUR OCEAN MERCANTILE MARINE, f 
 
 The late Henry C. Carey, who stands in relation to the 
 modern doctrine of protection very much the same as 
 Mahomet does to the religion of Islam, expressed the opin- 
 ion, over and over again, that the interest of the United 
 States — material and moral — would be greatly benefited if 
 the Atlantic could be converted into an impassable ocean of 
 fire ; and also that a prolonged war between the United States 
 and Great Britian would be one of the best possible things 
 for the former country. The late Horace Greeley taught 
 substantially the same doctrine, and in 1872, when a candi- 
 date for the presidency, said : "If I could have my way, I 
 would impose a duty of $100 on every ton of pig-iron 
 imported," or, in other words, he would not allow any ship 
 entering a port of the United States to transport any pig- 
 iron into the country. Senator Frye, of Maine, in a speech 
 at a " Home-Market Club " dinner in Boston, October 24, 
 1888, declared that he wanted " to see duties increased," so- 
 that no manufactures of silk or of wool or of iron and steel 
 could be imported. Ask also the protected representatives 
 of all other domestic manufactures, or the producers of raw 
 or crude materials used by manufacturers, and it will be rare 
 to find one who would not agree with Senator Frye in 
 respect to the tariff treatment of his specialties. 
 
 Prof. R. E. Thompson, of the University of Pennsylvania, 
 in his " Social Science and National Economy," which is used 
 as a text-book in the university, after devoting some pages 
 to showing the comparative undesirability of foreign trade, 
 expresses his sentiments in regard to it in the following- 
 language : " We have already given some reasons why com- 
 merce between distant points is an undesirable thing" (page 
 222). " If there were no other reasons for the policy that seeks 
 to reduce foreign commerce to a minimum, a sufficient one would 
 be found in its effect on the human material it employs. Bent ham 
 thought the worst possible use that could be made of a man was 
 to hang him ; a worse still is to make a common sailor ofhim'^ 
 
8 THE DECA Y OF OUR OCEAN MERCANTILE MARINE. 
 
 Certainly this method of putting an end to the bad influ- 
 ences of foreign commerce would soon reduce it to some- 
 thing less than a minimum, for if we were to hang all the 
 sailors there would be nobody to man our ships, and if our 
 ships could not be manned there would soon be no .ships, 
 and without ships so much of foreign commerce as is de- 
 pendent on ships for ocean transportation would cease to 
 exist ; and if from humanitarian motives it was decided not 
 to hang all the sailors, but to compel them to follow other 
 employments less detrimental to their morals and manners 
 — such, for example as working in Pennsylvania coal mines 
 — it would be, according to Prof. Thompson, an economically 
 wise and desirable measure, " for the work of sailors, "he says, 
 "while the most difficult of human employments, is also the 
 most unproductive, the most useless." 
 
 To put the most favorable interpretation, therefore, on 
 Prof. Thompson's words and teachings, he unmistakably 
 stands upon record as holding the opinion that all foreign 
 commerce is inexpedient, except so far as it can be carried 
 on by land and without the instrumentality of ships, which 
 "would necessarily limit the foreign commerce of the United 
 States at the present time to their exchanges between 
 Mexico and Canada, the aggregate of which is comparatively 
 trifling. 
 
 What sort of commerce Prof. Thompson would have be- 
 tween the United States and foreign countries he thus sets 
 forth : " If we take commerce in the largest sense, as mean- 
 ing the whole intercourse of nation with nation, it will include 
 the interchange of ideas, the naturalization of better political 
 and industrial methods. And with this intellectual exchange 
 there would be associated a commerce in those articles whose ar- 
 tistic excellence and elaboration of workmanship present in a 
 concentrated shape the flower of the nation s intellectual life and 
 spirit." 
 
 That such a transcendental commerce, such an exchange 
 •of bric-k-brac, does not in Prof. Thompson's mind include 
 
THE DECA Y OF OUR OCEAN MERCANTILE MARINE, g 
 
 the great bulk of the foreign commerce of the United States, 
 is clearly shown by the following quotation from a para- 
 graph immediately preceding the sentences last quoted : 
 " Every nation contains within its own providential bound- 
 aries the means of making itself independent of all others 
 as regards the supply of articles of prime necessity.* There 
 is, therefore, no need of employing a large number of its 
 people and a large amount of its capital in transporting 
 these articles across the ocean." 
 
 It is evident, therefore, that if the economic ideas which 
 Prof. Thompson teaches, and the University of Pennsyl- 
 vania sanctions, are to prevail, full eighty per cent, of the 
 present export trade of the United States— our agricultural, 
 mining, forest, and fishery products, — which her people and 
 her rulers are now most anxious to extend, would be put 
 an end to, as economically unwise, unnecessary, and un- 
 profitable. 
 
 Joseph Wharton, a leading citizen of Philadelphia, and a 
 president of the so-called " American Industrial League," in 
 an article contributed to the Atlantic Monthly some years 
 since " On International Trade," adopted as a motto perti- 
 nent to his argument, the following words, which Goethe 
 puts into the mouth of Mephistopheles, — or the Devil : 
 
 ' ' Talk not to me of navigation ; 
 For war )ind trade and piracy — 
 These are a trinity inseparable.^' 
 
 * This statement is on its face an absurdity. Tliere isTiot a nation on the 
 face of the globe which has risen above the requirements of a barbarous existence 
 that has ' ' the means of malcing itself independent of all others as regards the 
 supply of articles of prime necessity," according to the civilized interpretation of 
 terms. Every breakfast table in the land is a protest against Prof. Thompson's 
 assertion. England cannot supply itself with food ; Europe with cotton and 
 tobacco ; the United States with sugar, tea, coffee, spices, or dye-stuffs ; Mexico 
 with coal ; and so on. The law of nature, founded on, and an inevitable sequence 
 of, the diversities of race, intellect, climate, and culture, is that man and nations 
 alike everywhere are not independent, but interdependent, and becoming more 
 and more so as civilization increases. 
 
lO THE DECAY OF OUR OCEAN MERCANTILE MARINE. 
 
 Again, in a debate in the United States House of Repre- 
 sentatives, March, 1882, on the features of our existing- 
 consular system, the Chairman of the Committee on Appro- 
 priations, Representative Hiscock (now Senator), from the 
 great commercial State of New York, admitted that the 
 existing system was " complex," and " an obstruction to the 
 importation of foreign commodities " ; and for the latter 
 reason he declared himself in favor of its continuance ; for 
 he said : " I am unable to see how, when you relieve the 
 commerce of the country of the weight and burden of our 
 consular system, you are not to that extent abating the pro- 
 tection which is given to our industries." 
 
 Abundance of other illustrations to the same effect might 
 be given, but enough of unimpeachable evidence has been 
 offered to prove that the men who for the last quarter of a 
 century have shaped and determined the fiscal and commer- 
 cial policy of the United States, and are at present in con- 
 trol of the executive and legislative departments of the 
 government, do not believe in international commerce ; do 
 not believe in the continuance and enlargement of the 
 business for which alone ships are needed, or in the condi- 
 tions which alone make the existence of an ocean mercantile 
 marine possible. The men who have adopted these ideas 
 have furthermore not been simply theorists. They have 
 not stopped with mere believing, but having the oppor- 
 tunity, they have embodied their ideas into statutes, and 
 made them the law of the land. And the public officials 
 charged with the administration of the law, taking their cue 
 from the expressed views of the law-makers, seem to regulate 
 their conduct in office on the theory that foreign commerce 
 is an offence which they are in duty bound to discourage ; 
 and accordingly, as has been especially exemplified under 
 the present administration, eagerly take advantage of every 
 doubtful point in the wording of the statute, to make a 
 construction on the side of illiberality. 
 
THE DECAY OF OUR OCEAN MERCANTILE MARINE. II 
 
 Whatever of decay and disaster has come to our ocean 
 mercantile marine has clearly, therefore, not been the result 
 of accident, but of design, — manifesting itself not in open 
 and avowed hostility to ships, for such a course, on account 
 ■of national historic associations, would not have been poli- 
 tic, but design in the sense of perfect willingness that our 
 ocean-carrying trade should perish, if thereby the free ex- 
 change of the products of the United States for the products 
 of other countries could be restricted or prevented ; and the 
 instrumentalities by which such design has been made reality, 
 are substantially as follows : 
 
 First, By the maintenance of a system of navigation 
 laws, which were avowedly modelled on the very statutes of 
 Great Britain which the Americans as colonists found so 
 oppressive that they constituted one of the prime causes of 
 their rebellion against the mother-country, — the main feat- 
 ures of difference between the two systems being, that 
 wherever it was possible to make the American laws more 
 rigorous and arbitrary than the British model, the opportu- 
 nity was not neglected. And these laws, without material 
 change, hold their place to-day upon our national statute- 
 book. International trade since their enactment has come 
 to be carried on by entirely different methods : ships are 
 different ; voyages are different ; crews are different ; men's 
 habits of thought and methods of doing business are differ- 
 ent ; but the old, mean, absurd, and arbitrary laws which 
 the last century devised to shackle commerce remain un- 
 changed in the United States, alone of all nations ; and 
 what is most singular of all, it is claimed to be the part of 
 wisdom and the evidence of patriotism to uphold and defend 
 them. 
 
 The main provision of these laws is one which forbids an 
 American citizen, if he can buy a vessel cheaper and better 
 suited to his wants in a foreign country, from availing him- 
 self of the opportunity. No American citizen is allowed to 
 
12 THE DECA Y OF OUR OCEAN MERCANTILE MARINE. 
 
 import a vessel of foreign-build, in the sense of purchasing, 
 acquiring a registry or title to, or using her as his own 
 property, — the only other absolute prohibitions of imports, 
 on the part of the United States, being in respect to coun- 
 terfeit money and obscene publications or objects. And 
 from this last circumstance the inference is fully warranted 
 that in the eyes of American legislators the importation of 
 a foreign vessel must be prejudicial in the highest degree to 
 the morals of the country.* Note now the effects of this 
 law. 
 
 Experience having demonstrated that the ships of the 
 United States cannot do the work which the commerce of 
 the world needs to have done as cheaply and as conveniently 
 as the ships of Great Britain and other competitive maritime 
 nations, the representatives of the world's commerce, who 
 do not mix up business and sentiment, and who simply ask 
 who will serve us best and at the cheapest rates, do not em- 
 ploy American ships ; and for the same reasons, the former 
 great business of building ships in the United States for sale 
 to foreigners no longer exists. 
 
 Furthermore, while we are \he only people in the world 
 who are forbidden to purchase foreign-built vessels, we 
 freely permit all the world to enter our ports with vessels 
 purchased in any market. Precluded, therefore, by the first 
 provisions of our navigation laws from engaging on equal 
 terms in the carrying trade with foreigners, we wonder and 
 
 * Although the law (Revised Statutes of the United States, Sec. 4,132 and 
 4,133) which denies to citizens of the United States registry, protection, or 
 ownership of foreign-built vessels is very clear and explicit, there is reasonable 
 doubt of its constitutionality. The late Caleb Gushing, Attorney-General of 
 the United States, 1853-57, ga've an opinion, that a bale of goods, or any 
 property, purchased abroad and paid for by an American citizen, became Ameri- 
 can property, and as such was entitled to the protection of the flag. This 
 opinion was subsequently but unofficially laid before Hon. Amos T. Ackerman, 
 Attorney-General of the United States in 1870, and elicited the opinion, that a 
 vessel purchased by an American citizen in a foreign port, and covered with the 
 American flag, was entitled to her register the same as an American-built vessel. 
 
THE DECAY OF OUR OCEAN MERCANTILE MARINE. I J 
 
 complain that the carrying-trade of our own products has 
 passed from our control. 
 
 Numerous other provisions of our navigation laws have 
 contributed in a lesser degree to the destruction of our 
 ocean mercantile marine ; but it is not proposed to say fur- 
 ther of them in this connection, except to call atten- 
 tion to the curious circumstance, that not a single writer or 
 speaker of note, who in recent years has undertaken to de- 
 fend them, or oppose their repeal, or modification — ^through 
 lack of knowledge, or more probably a well-grounded appre- 
 hension lest a full exposition would of itself defeat his 
 argument, — has ever ventured to tell his hearers or readers, 
 what the code really embraces, or make clear its details. 
 
 A second instrumentality which has contributed in an 
 even greater degree to the decay and almost absolute de- 
 struction of our ocean mercantile marine, has been the 
 enactment and maintenance of laws by the men who have 
 for so many years shaped and controlled our national fiscal 
 and commercial policy, and who, as has been demonstrated, 
 disbelieve in the desirability of foreign commerce, which 
 by the imposition of enormous taxes on imports — amounting 
 in 1887 to 3.n average of 47 per cent, of the value of all 
 dutiable imports, and 3 1 per cent, on the value of all im- 
 ports — practically forbid American manufacturers, agricul- 
 turists, and merchants, from receiving the products of other 
 nations in exchange or payment for their own ; which say, 
 in fact, to the citizens of Chili and Mexico, " We want to 
 sell you our cotton fabrics and agricultural implements, but 
 you shall not sell us your ores of copper, or of silver-lead " ; 
 and to the producers in the Argentine States, Australia 
 and South Africa, " We want to sell you clothings boots, 
 and shoes, machinery and hardware, but we won't buy the 
 principal product — wool — which you have got to sell — or 
 pay with — in return." But in thus shutting out the prod- 
 ucts of other nations, we have at the same time necessarily 
 
> 
 
 14 THE DECA Y OF OUR OCEAN MERCANTILE MARINE. 
 
 shut ourselves in. For all commerce — foreign and domes- 
 tic — is simply the exchange of products ; so that he who 
 won't buy can't sell, and he who won't sell can't buy. 
 
 The attempts to invalidate these conclusions seem al- 
 most puerile ; but, nevertheless, as they continue to be 
 made by respectable journals, it is expedient to notice 
 them. It is asserted, for example, that it is not necessary 
 to import in order to export. But that is equivalent to 
 saying that a nation can or will go on selling to other 
 nations without receiving pay for what it sells, which 
 ignores the economic axiom, that in the long run the ex- 
 ports and imports of every nation must pay for each other, 
 or the trade will cease, — a fact that would practically appear 
 in every national trade statement, but for the circumstance, 
 that imports, as in the case of England, are often made for 
 the purpose oi paying va.\.e.x&s\. on foreign investments which 
 represent long antecedent exports ; or obligations of the 
 indebtedness (in the shape of bonds) are exported in the 
 place of merchandise to pay for imports, as is often the case 
 with the United States. 
 
 It is also asserted that it is not necessary for a country 
 to receive the ordinary products of other countries in pay- 
 ment of its exports, but that payment may be made by an 
 import, or return of the precious metals. The answer to 
 this is, that no nation can spare sufficient of its gold — the 
 standard money of international trade — to pay for even so 
 little as the average value of its importations for a single 
 month ; the unexpected export of a million and a half of 
 gold from the United States in September, 1889,— with a 
 net balance of $189,000,000 in the national treasury, — hav- 
 ing caused a thrill of disturbance to run through every 
 financial and commercial interest of the country. The first 
 question a representative of any of the states of South 
 America would naturally put when asked to consider a 
 proposition to buy more — i. e., extend trade — from the 
 
THE DECAY OF OUR OCEAN MERCANTILE MARINE. IS 
 
 United States and pay gold for such increased exports, or 
 purchases, would be : " Where are we to get the supply of 
 gold essential for such a method of trade ? and does the 
 United States propose to drain us at once of our gold, and 
 so precipitate a financial panic among our people ? " 
 
 How successfully the present fiscal and commercial policy 
 of the United States has operated to restrict foreign com- 
 merce, or in limiting our markets in foreign countries, is 
 shown by an almost universal recognition of the fact, 
 that for the lack of such markets as our foreign competitive 
 nations possess, our surplus of manufactured products is 
 pressing with smothering effect upon our whole circle of 
 industries. What effect it has in restricting our markets, 
 especially in South America, is shown by the fact, that 
 while 6,607 steamers entered and departed from the ports 
 of the Argentine Republic in 1887, not one bore the flag of 
 the United States; while in 1888 only seven steamers ar- 
 rived from the United States, and these were all foreign 
 tramp steamers, which go everywhere, upon the shortest 
 notice, in search of freights affording the minimum of re- 
 muneration. It is, therefore, clear that it was not from 
 lack of instrumentalities for inter-communication, or cheap 
 rates of freight, but lack of business, that hmited the exports 
 of the United States to the Argentine Republic in 1888 to 
 the capacity of seven tramp steamers, averaging in the 
 aggregate less tonnage than one of our great transatlantic 
 steamers. Had the business been possible, not seven, but 
 seventy tramp steamers would have been on hand to com- 
 pete for it. 
 
 A few years after the war, a well-known commercial firm 
 in Boston, which before the war had a large trade with the 
 west coast of South America — and particularly with Chili, — 
 attempted to regain the trade which the war had interrupted. 
 For this purpose they established a line of steamers to run 
 regularly between Boston and Valparaiso. The vessels — 
 
l6 THE DECA Y OF OUR OCEAN MERCANTILE MARINE. 
 
 screw steamers — were built in England and owned in the 
 United States, but owing to the provisions of our navigation 
 laws, their registry was in London and they carried the 
 British flag and were commanded by a British captain. So 
 far as the instrumentalities for doing business were concerned^ 
 the Boston merchants put themselves on a perfect equality 
 with their foreign competitors. There was no difficulty, 
 moreover, in obtaining full outgoing cargoes, for there was 
 then, as now, a demand in Chili for American productions — 
 cotton fabrics, sewing-machines, woodenware, hardware, 
 machinery, and the like. But ships, to be profitable, must 
 earn freights both going to and returning from a market, 
 and the only commodities which Chili had to give in ex- 
 change for our products were copper, copper-ores, and wool, 
 on the importation of all of which the United States imposes 
 wholly, or nearly, prohibitive duties. Th^<5QJi^33en^evwas 
 that these Boston steamers, in order to oBtain return cargoes 
 from Chili, were obliged to take ja freiglff of wool and cop- 
 per on English account, and on arrival in Boston, trans-ship 
 it in bond in an English vessel for Liverpool. It^is-j^ilmost 
 needless to say that such a roundabout way of ^^Eig Busi- 
 ness did not pay, that the American line of steamers in 
 question was soon withdrawn, and that since then no citizen 
 of the United States has ventured to repeat the experiment. 
 One more incident is necessary to complete this story. 
 Some years ago a roving commission, composed of men who 
 had little or no practical or theoretical acquaintance with 
 commerce, was sent by the United States to Central and 
 South America, for the purpose of determining how more 
 intimate commercial relations could be established between 
 these countries and the United States. In due time they 
 came to Chili, and had an audience with its president. They 
 laid before him the purport of their mission, and asked him 
 to consider the negotiation of a treaty establishing a reci- 
 procity of trade between Chili and the United States. The 
 
THE DECAY OF OUR OCEAN MERCANTILE MARINE. I'J 
 
 Chilian president politely but decidedly declined to con- 
 sider the subject. " It was out of no want of respect," he 
 said, " for the United States ; but it was his settled belief 
 that all treaties were needless ; that there could be no con- 
 trol by any convention of the laws of trade ; that men would 
 buy and sell where it was most for their advantage ; and 
 that this could not be aided or materially influenced by 
 national compacts." In conclusion he further remarked 
 that " Chili opened all her coasts to the vessels of any nation, 
 the United States included, and in turn the Chilian flag 
 ought to have access to the ports of the United States in 
 like manner." Commenting on this satirical though emi- 
 nently sensible remark, the United States Commission, in 
 their report of the interview, use this language : " Of course 
 it was not worth while to dwell upon such an avowal." How 
 far the Chilian people were in sympathy of opinion with 
 their president may be inferred from the following com- 
 ments on the object of the United States Commission in 
 question, which appeared in the leading newspaper and gov- 
 ernment organ in Valparaiso. 
 
 "We believe," it said, "that the United States do not find 
 markets for their products in South America, because the United 
 States has shut her doors to the products of South America. The 
 United States, by means of its heavy tariff, has proposed to realize 
 the impossible, or the selling to all the world without buying any 
 thing from anybody. This being so, it does not need much keen- 
 ness to discover the origin of the evil and to point out the remedy. 
 If English goods come here in large quantities it is because the 
 ports of Great Britain are open to Chilian products. If we buy 
 of the English, it is because they do not repel through- a protec- 
 tive tariff the articles we produce, and of which we can avail our- 
 selves to pay for what we buy ; and if the United States desire to 
 enjoy the benefit which the English reap from this commerce 
 they have only to follow their example — lowering their tariff and 
 opening their ports to us. Such a measure would be much more 
 
l8 THE DECAY OF OUR OCEAM MERCANTILE MARINE. 
 
 efficient for the object sought for by the honorable plenipotenti- 
 aries than their manifestations of friendly feeling, which, not 
 being seconded by the practical measures above stated, cannot 
 produce any favorable change in the conditions of the commerce 
 of the United States with the people who inhabit this (South 
 American) continent." 
 
 The following is a further illustration of the manner in 
 which our existing fiscal policy closes the markets of the 
 world to our surplus manufactured products, and renders 
 foreign commerce and the maintenance of an ocean 
 mercantile marine on the part of the United States a 
 practical impossibility. During the the year 1887, the 
 United States imposed tariff taxes on the import of per- 
 fectly crude or raw materials, and on articles wholly or 
 partially manufactured — all imports for use in the manufac- 
 tures or mechanic arts of the country — to the extent of 
 $40,000,000. But forty millions is ten per cent, on $400,- 
 000,000 of product into which these crude materials enter 
 as constituents, and to such an extent must enhance its 
 price when offered for sale, if the manufacturer would recoup 
 hiinself for its payment. But no business man needs to be 
 told, that not a dollar's worth of such an immense amount 
 of product can be sold in any foreign market in competition 
 with the manufacturers of similar products in Great Britain 
 and other countries, who are exempt from such a burden of 
 taxation ; or what is the same thing, who are by our own 
 acts given an advantage of ten per cent., or can undersell 
 American producers and exporters to that extent in any 
 neutral markets of the world. And as a matter of fact, we 
 find that out of $683,860,000 worth of goods, wares, and mer- 
 chandise, exported from the United States during the fiscal 
 year 1888, less than 20 per cent. (19.05 exactly) were manu- 
 factured articles.* But great as are the present restrictions 
 
 * The men most conversant with the practical application of electricity in the 
 United States assert, that the present difference in the price of copper between 
 
THE DECAY OF OUR OCEAN MERCANTILE MARINE. 19 
 
 on the foreign commerce of the United States and the 
 almost insuperable obstacles in the way of having an ocean 
 mercantile marine, it is well at this point also to consider 
 what would happen, if Senator Frye, and others who agree 
 with him, could succeed in having the duties at present 
 levied on dutiable imports, increased, as they say they 
 ought to be, to the extent of absolute prohibition. In 
 such a case the United States would receive from foreign 
 countries only such few products as are at present not 
 dutiable, and so not antagonistic to the full operations 
 of the protective policy. This would at once reduce the 
 existing volume of our foreign commerce about two-thirds. 
 We should, on the basis of 1888, exclude foreign imports of 
 merchandise to the extent of $480,000,000. But as imports 
 are made solely for the. purpose of obtaining, or paying for 
 exports — product being given for product, — such an exclu- 
 sion of imports would at once reduce the export of the 
 products of American labor in a corresponding degree. If, 
 under stress of circumstances, foreign nations should so 
 greatly need our cotton, cereals, and other crude products, 
 that they would be willing to pay for them in gold, of what 
 use would such an import of gold be to us? We have 
 already more than $700,000,000 of gold in the country, of 
 which a very considerable part is not in use as currency. 
 We could not eat it, wear it, or use it in any way, except to 
 exchange it for articles of foreign production, and these in 
 turn to be used and enjoyed, would have to be used and 
 enjoyed out of the country. The evidence is thus complete, 
 that so long as we maintain a commercial policy that seeks 
 to restrict or prevent commerce with other nations, so long 
 ships will not come back to us ; for opportunity for their 
 
 the United States and Europe, due solely to an unnecessary tariff tax on the 
 imports of copper, ' ' is enough to swallow up all the profit on the export of 
 many electrical supplies, such as insulated wire and cables, while it places 
 American makers of dynamos, and of other apparatus containing copper and 
 brass, at a decided disadvantage in the markets of the world." 
 
20 THE DECAY OF OUR OCEAN MERCANTILE MARINE. 
 
 employment would be limited, even if they were placed as 
 free gifts at our wharves. 
 
 Such then is a picture of the situation in which our 
 former great industry of ship-building and ship-using finds 
 itself, not one essential particular of which as has been 
 presented can be fairly questioned or refuted. The expul- 
 sion of the Moors and Jews from Spain under Ferdinand 
 and Isabella and their successors, and the revocation of the 
 " Edict of Nantes," which deprived France of her best arti- 
 sans and industries, have been accepted by all historians 
 and economists as the two most striking and exceptional 
 examples in modern times of great national industrial dis- 
 aster and decay directly contingent on unwise and stupid, 
 but at the same time deliberately adopted, state policies. 
 It has been reserved for the United States, claiming to be 
 one of the most enlightened and liberal nations of the 
 world, after an experience of near three hundred years 
 since the occurrence of the above precedents, to furnish a 
 third equally striking and parallel example of results con- 
 tingent on like causes, in the dec^y and almost annihilation 
 of a great branch of domestic industry, which formerly, in 
 importance, ranked second only to agriculture. 
 
 HOW CAN WE BRING BACK OUR SHIPS AND INCREASE OUR 
 FOREIGN COMMERCE ? 
 
 Having thus exhibited the inception and causes of the 
 decay of our ocean mercantile marine, the way is now clear 
 for a consideration of the methods and feasibility of bring- 
 ing back ships of the most desirable character, as instru- 
 mentalities for the profitable employment of the labor and 
 capital of the United States, and for increasing our foreign 
 commerce, which can alone give employment to an ocean 
 marine and afford a market for the surplus products of our 
 industries. 
 
 And first, if the primary cause of the decline of American 
 
THE DECAY OF OUR OCEAN MERCANTILE MARINE. 21 
 
 shipping employed in the ocean carrying trade was due (as 
 "beyond all question it was) to the fact, that American 
 ships could not do the work which the trade and commerce 
 of the worjd required to have done as cheaply, as expedi- 
 tiously, and as conveniently as the ships of Great Britain 
 and other competitive maritime nations ; if the inception of 
 this decline was coincident with the recognition of this fact 
 by American and foreign merchants, and if the same causes 
 which in the first instance arrested the growth and occa- 
 sioned the decay of American ocean tonnage have ever 
 since continued and are now fully operative, then it 
 needs no argument to prove that the first step to be taken 
 in the way of recovery is for the American shipping inter- 
 est to put itself on a par with its foreign competitors in 
 respect to the excellence of the tools or instruments — /. e., 
 the ships and all their appurtenances — which it needs to 
 employ in the transaction of its business. Unless this first 
 step is taken, unless this primary and indispensable result 
 can be effected, there is no use of further talking ; and we 
 might as well fold our hands and complacently say : " We 
 do not propose to be a maritime nation." People in this 
 age of the world will no more continue permanently to use 
 poor or unnecessarily expensive tools in trade and com- 
 merce, than they will in agriculture and manufactures. 
 They will either, as the outcome of intelligence, voluntarily 
 adapt themselves to the new conditions that may arise, and 
 so prosper ; or, as the outcome of ignorance and obstinacy, 
 adhere to the old, and be crushed and starved out of 
 existence. 
 
 Steamships suitable to meet the present requirements 
 of the commerce of the world cannot be built at the pres- 
 ent time in the United States as cheaply as they can be 
 in Great Britain. Steamships of the best quality can be 
 and are being built in the United States for the use of its 
 navy, and for coast and inland navigation. But such ships 
 
22 THE DECA Y OF OUR OCEAN MERCANTILE MARINE. 
 
 are not subjected to any foreign competition. The exact 
 extent of this disparity of cost cannot be readily stated. 
 The disparity due to the difference in the comparative 
 prices of iron and steel in the two countries increases the 
 Cost of American vessels, in the opinion of experts, to at 
 least fifteen, and probably a greater percentage. The dis- 
 parity in the cost of machinery is much greater, and greater 
 furthermore at the prevailing low prices than it was twenty 
 years ago, when the actual prices<were higher than now in 
 both countries. The best cotton manufacturers in the 
 United States are importing cotton machinery from Eng- 
 land, paying duties of 45 per cent, and more on the same, 
 and think they find their advantage in so doing. First- 
 class freighting screw steamers built of steel and thoroughly 
 equipped with all modern appliances were built in Great 
 Britain in 1888 for $34 per ton, as compared with $90 per 
 ton in 1874. But be the disparity of cost between Ameri- 
 can and foreign-built steamships * greater or less, it is suffi- 
 cient to recognize in this connection that it is considerable ; 
 and to expect that under such circumstances the former 
 can successfully compete with the latter in the same sphere 
 of employment, is as idle as to expect that a man with his 
 feet in a sack can compete in a race with one whose limbs 
 are free and unshackled. 
 
 How American business men who still want to do busi- 
 ness on the ocean recognize this condition of affairs and 
 adapt themselves to it, is best shown by a few actual 
 examples. Thus, the last report of the Pacific Mail Steam- 
 ship Co., of New York, announces that there is now 
 building for the company, in Great Britain, a steamer of 
 
 * It is claimed that steamships of absolutely the first class, like the Eiruria 
 and Teutonic — owing to the greater skill and efficiency of American labor, 
 which, although nominally high-priced, is cheap because of its efficiency — can 
 now be built in the United States on terms as favorable as in any other country ; 
 but this claim is not preferred in respect to steamships constructed mainly for 
 freight service. 
 
THE DECAY OF OUR OCEAN MERCANTILE MARINE. 23; 
 
 5,000 tons ; and it is made a matter of congratulation to the 
 stockholders, that this is to be effected at a saving in cost 
 of one third as compared with prices asked by builders 
 in the United States. Some years ago the Pennsylvania 
 Railroad determined to establish a line of transatlantic 
 steamships to run in connection with its road between 
 Philadelphia and Liverpool. At the outset the company 
 proposed to use steamers of American construction only,, 
 and did provide itself with four vessels of this character. 
 But subsequently, finding itself in need of new steamships, 
 it quietly discarded Pennsylvania's pet theories about 
 American industry and employment of home labor, and 
 supplied its necessities with ships of British construction ; 
 and, with infinite effrontery, subsequently memorialized Con- 
 gress to specially grant to them, a registry, in order that 
 this company alone in the United States might enjoy the 
 privilege of lawfully holding such vessels as property. 
 
 Wilmington, Delaware, is a place where vessels of the 
 latest style of construction and material can be built. But 
 the merchants of Baltimore, which city is in close proximity 
 to Wilmington, do not go there for their supply of ocean 
 steamers, but use British-buflt vessels, which they cannot 
 own or run as American property, in their extensive fruit 
 trade with Central America and the West Indies ; and the 
 same is true of those lines of steamers which are engaged in 
 like business running out of Philadelphia. 
 
 The following is an even more striking instance of the 
 disadvantage the merchants of the United States labor 
 under in being prohibited from buying foreign vessels for 
 use in their own business. There were, a few months 
 ago, twenty-four Norwegian steamers running on time 
 charters in the fruit trade between New York and Baracoa,^ 
 and more than half of these steamers were built in Great 
 Britain or other countries foreign to Norway. What does, 
 this mean ? It means that our stupid system prohibits our 
 
24 THE DECAY OF OUR OCEAN MERCANTILE MARINE. 
 
 merchants from putting their capital into vessels where it 
 could be employed to advantage in bringing goods Iro our 
 own market, and compels them to employ foreigners to do 
 the business and pocket the freight money. 
 
 During the present year there have been under construc- 
 tion in the ship-yards of Great Britain about 200,000 tons of 
 shipping (of iron or steel) for foreign owners. Of this 
 amount Germany is reported to have ordered 80,000 tons ; 
 little Portugal, 20,000 ; France, Norway, and the British 
 Colonies, 10,000; but the United States is credited with 
 only one steamer of 5,000 tons, building for the Pacific Mail 
 S. S. Co., and a bark at Glasgow on Boston account. 
 
 Now, to repeal the prohibition against the purchase of 
 foreign ships by citizens of the United States, is not a free- 
 trade measure in the sense in which this term is generally 
 used, but a measure in the largest interest for protection. 
 It is a measure not so much with a view of setting our com- 
 merce up, as for removing an obstacle to its setting itself 
 up. It is a genuine American policy according to the doc- 
 trine of protection, inasmuch as it will tend to promote and 
 develop a great branch of domestic industry ; while the 
 present policy, which pretends*to be genuine protection, is 
 really so promotive of European interests that almost every 
 maritime nation is increasing its ocean tonnage at the ex- 
 pense of the United States. 
 
 But a measure more essential for the restoration of 
 our shipping and our ocean carrying trade is a radical 
 reform of our whole tariff system and policy. We have 
 got to recognize the fact that it is just this system and 
 policy that has made it impossible to maintain our status 
 as a commercial nation upon the ocean. We have got to 
 recognize that the present pressing necessity of the United 
 States is extended markets for the continually increasing 
 surplus of our products ; and that such markets cannot 
 be obtained, or a national commercial marine find a basis 
 
TBE DECAY OF OUR OCEAN MERCANTILE MARINE. 25 
 
 for growth, or even existence, so long as we restrict by 
 law the producers of this country from freely exchanging 
 the products of their labor with the products of the labor of 
 the producers of other countries. But these are just the 
 conditions which the representatives of the policy which 
 has driven our ships from the ocean and destroyed our 
 foreign markets do not propose to recognize. They propose 
 not only that no part of our protective system as embodied 
 in our present tariff shall be destroyed, but rather that 
 further restrictions on commerce shall be multiplied. They 
 claim that the present policy can be maintained, and the 
 decadence of American shipping arrested, and an era of 
 maritime prosperity inaugurated, by the payment of ship- 
 ping subsidies, which are in the nature of bounties. Or, in 
 other words, having almost completely destroyed a great 
 branch of domestic industry, by compelling it to submit to 
 the unnatural restraints of an artificial system, it is now pro- 
 posed to repair the damage, not by removing the cause, but by 
 resorting to another artificial expedient — namely, the hiring 
 of men to do what the first artificial system makes it for 
 their interest not to do. On its very face could any thing 
 be more economically monstrous and impracticable ? But, 
 discarding alL matters of sentiment, let us examine this 
 question from a purely practical point of view. 
 
 THE QUESTION OF SUBSIDIES. 
 
 The first objection to this scheme is, that it is a mere 
 palliative, and even if remedial in part, and unobjectionable 
 as a matter of public policy, bears no proportion to the 
 magnitude of the trouble to be dealt with. Capital and 
 men can be undoubtedly hired to float the American flag. 
 But does anybody suppose that with the present temper of 
 the American people in respect to subsidies and the expen- 
 diture of public moneys raised by taxation, that the policy 
 of paying bounties can be indefinitely continued as to both 
 
26 THE DECAY OF OUR OCEAN MERCANTILE MARINE. 
 
 time and amount. But they must be so continued on the 
 bounty theory, unless the causes which will not allow citizens 
 of the United States to build and use ships as cheaply as for- 
 eigners, are removed ; and if they are removed, then bounties, 
 will be no longer necessary, for ships will be procurable with- 
 out bounties. Take another view of the situation. Having 
 discouraged foreign trade by exorbitant taxation, we are now 
 asked to heap up more taxes in order to encourage the same 
 trade by cheapening freights. Having protected domestic 
 wools by almost prohibitory taxes on the import of com- 
 peting wools — especially the product of South America, — it 
 is now proposed to tax the American wool-grower in order to 
 secure lower transportation rates on the foreign wools that 
 he regards as especially competitive. In the case of the 
 trade between the United States and the Argentine Re- 
 public it is the judgment of experts that any subsidy to be 
 effective, must be as great at least as will suffice to com- 
 pensate the American ship-owner who exports, for the 
 losses he now experiences from his inability to obtain a 
 return cargo (paying freights) of imports. Neither probably 
 will it be pretended, in the face of the intense competition 
 to effect sales in the world's markets, that the profit accru- 
 ing from any enlarged exports on account of subsidies, will 
 be equal to the subsidy payments ; or in other words, 
 although a comparatively few ship-owners may gain, the 
 people will lose. 
 
 But will the rates of ocean freights be cheapened to 
 American exporters by the granting of subsidies to Ameri- 
 can-built vessels ? It is barely possible that they may be to 
 a limited extent under certain circumstances ; but such a. 
 result is not probable. The subsidized owner will take his 
 subsidy and charge for his freight service the current rates. 
 If he reduces rates, his competitors will do the same, and 
 the cost of ocean transportation will remain relatively as 
 before. There are no unoccupied ocean trade routes ; none 
 
THE DECA Y OF OUR OCEAN MERCANTILE MARINE. 2f 
 
 in which abundant instrumentaHties for the carrying trade 
 would not be promptly and voluntarily supplied, if there 
 was a chance of making even a small profit out of such 
 jsupply. The recourse to subsidies is, therefore, a mere 
 temporizing policy, and does not reach the broad problem, 
 how to prevent the transfer of our whole ocean mercantile 
 service to foreigners. 
 
 Again, our whole experience, in common with the ex- 
 perience of other nations, in respect to the payment of 
 subsidies as a method of encouraging ocean navigation, has 
 been unfavorable. The Federal exchequer was opened for 
 years, in order that this itiode of developing our steam- 
 marine might have a fair trial ; and what were the results ? 
 Before the war the Government gave large subsidies to 
 the Collins, Havre, Bremen, Pacific, and other lines; but 
 these contributions had no effect in preventing the contin- 
 ual decay of our merchant marine, and in 1861 there were 
 no American ocean steamers away from our own coasts. 
 
 After the war, or from 1867 to 1877, when there was no 
 -war or Confederate cruisers to interfere with the develop- 
 ment of our commerce and the use of American ships, the 
 United States gave still larger sums in the way of subsidies ; 
 in the aggregate, $4,750,000 to the Pacific Mail Steamship 
 •Co., and $1,812,000 to the line between, the United States 
 and Brazil. The subsidy system as an agency for restoring 
 our commercial marine had, therefore, during this period of 
 eleven years, as fair a trial as possible, and the results it 
 worked out so far failed to accomplish what its advocates 
 had in view, and were connected with such a disgraceful 
 ■chapter of Federal legislation, that Congress, in accordance 
 with an almost universal popular sentiment, put an end to 
 the whole business. 
 
 The more recent commercial experience of the United 
 States is instructive in even a greater degree on the subsidy 
 question. Investigations instituted by the New York Com- 
 
28 THE DECAY OF OUR OCEAN MERCANTILE MARINE. 
 
 mercial Bulletin show that there are at present 29 lines, with 
 an aggregate of 125 steamers, regularly engaged in traffic 
 between the United States and the West Indies, Central and 
 South America. This service has greatly improved and in- 
 creased within the last six years, or since 1883, and is now 
 entirely ample to accommodate all existing demands for 
 transportation. And yet, notwithstanding the enlarged op- 
 portunities for trading which have been thus afforded to us, 
 there has been a decrease, in the same time, of our exports to 
 the countries specified, to the extent of 12^ per cent. Our 
 facilities for trading, so far as the carrying service is con- 
 cerned, are especially efficient as respects the West Indies, 
 and the ports of Mexico and Central America; and yet 
 our exports to the West Indies were $5,316,848 less in 1888 
 than they were in 1883 ; and to Mexico and Central 
 America $2,934,000 less.- Going further south we find two 
 lines of steamers subsidized by the Brazilian Government 
 and making regular connection with our Atlantic ports ; 
 but the exports of our industrial products to Brazil 
 were 2\\ per cent, less in 1888 than they were in 1883. 
 The main argument of the advocates of shipping subsidies, 
 that we only lack means of transportation to secure a fairer 
 share of the trade of the countries south of us, is clearly, 
 therefore, by this record of experience completely demol- 
 ished. 
 
 But while our exports to these southern countries have 
 notably diminished, our imports from them have in the 
 same time greatly increased — that is, we buy more of and 
 sell less to our neighbors than formerly. To some this 
 latter fact may seem paradoxical and inconsistent with the 
 position before taken, that trade ^between the United States 
 and Central and South America is restricted, because this 
 country refuses reciprocal exchange of products. The 
 explanation is, however, very simple, and there is no incon- 
 sistency of statement. We buy of the West Indies, Cen- 
 tral and South America great quantities of sugar, coffee, 
 
THE DECA Y OF OUR OCEAN MERCANTILE MARINE. 29. 
 
 tropical fruits, india-rubber, and hides, because we cannot 
 produce these commodities at all, or in sufficient quantity 
 to meet our demands for consumption, and can buy them 
 cheaper of our southern neighbors than elsewhere. Under 
 our existing tariff, however, especially our tariff on crude 
 materials entering into our manufactures, we are not able 
 to sell in the way of payment to the producers of sugar,, 
 coffee, fruits, rubber, and hides, such products of our in- 
 dustries as we would like to dispose of, and which the 
 foreigner desires and needs to have ; because the latter can 
 buy them cheaper in other countries — mainly in Great 
 Britain. Our indebtedness to South America for our increas- 
 ing exports is, therefore, settled in another way. England 
 pays the bill in the first instance by the export of her 
 manufactured products, and we pay England by the ex- 
 port to her of our agricultural products, cotton, cereals, 
 meats, and the like ; and as a matter of fact, this round- 
 about, unnatural commerce represents what may be termed 
 a triangular voyage. Thus, a ship loads at Rio Janeiro, for 
 example, with coffee for New York, unloads there and re- 
 loads with grain for England, unloads there again, and 
 again reloads with English manufactures for Brazil. And 
 as English vessels are cheaper than any which Americans 
 can build or have a right to own, the English vessels mainly 
 do the work and earn all the profits, and English bankers 
 and capitalists gather in the commissions and accruing in- 
 terest on the capital employed. Or, to put the case more 
 briefly, our existing tariff gives every foreigner every possi- 
 ble advantage for buying manufactured products in every 
 market of the world other than our own. 
 
 DOES GREAT BRITAIN ENCOURAGE HER MERCHANT MARINE 
 BY THE PAYMENT OF SUBSIDIES? 
 
 Prominent among the arguments brought forwar(i in 
 support of the proposition to attempt to arrest the decay 
 and restore the prosperity of our merchant marine by 
 
2,0 THE DECAY OF OUR OCEAN MERCANTILE MARINE. 
 
 means of subsidies, or extraordinary payments on the part 
 of the Government, is the assertion that the systematic 
 appropriation of large sums for the special object of encouraging 
 ship-using and ship-building has always been the practice and 
 J>olicy of Great Britain ; and further, that to the con- 
 tinuance and present maintenance of such a system, is to 
 be attributed the continual advance and present great de- 
 velopment of the British shipping interest. So frequently 
 and so unqualifiedly, moreover, have these assertions been 
 made in recent years, on the floor of Congress, by public 
 officials, by Chambers of Commerce, and by leading jour- 
 nals, and so seldom have they been questioned, that the 
 people of the United States have very generally come to 
 regard them as matters of history and of record which could 
 not be doubted. And the premises being at once accepted, 
 the conclusion was legitimate, that for the Federal Govern- 
 ment to adopt the subsidy system was but to follow a pol- 
 icy which the long experience of the greatest maritime 
 nation had taken out of the domain of theory, and proved 
 to be eminently wise, practicable, and successful. All these 
 assertions, however, will be found on examination to rest 
 on no truthful or substantial basis ; and to be what may 
 be properly designated as historic lies, originating mainly, 
 in the first instance, without intent to deceive, through 
 an imperfect understanding of the subject, and subse- 
 quently repeated and given credence on the basis of some 
 personal or supposed authority, without any attempt to in- 
 quire further as to their accuracy. 
 
 In support of this averment attention is asked to the 
 following statement of facts : The Empire of Great Britain 
 extends around the globe, and of its population of over 
 300,000,000, only about one eighth live within the territory 
 of the United Kingdom. To keep up a constant and regu- 
 lar communication with her detached colonies, military and 
 naval stations, by means of ocean sea-service, is a necessity 
 
THE DECA y OF OUR OCEAN MERCANTILE MARINE. 3I 
 
 for the maintenance of the empire ; just as much as quick 
 and cheap communication with all of the States of the 
 Union, by railway service, is necessary for the proper ad- 
 ministration of the Federal Government at Washington. 
 
 It is not to be denied that Great Britain, in maintaining 
 this service, has expended, and is still expending very con- 
 siderable sums ; but it is important in this connection to 
 recognize two facts. First. That in the days prior to i860, 
 when the sea service which Great Britain required was per- 
 formed mainly by sailing vessels, she paid more than double 
 per annum what she now pays for like service. But no one 
 ever thought of regarding such payments, in the days of 
 sailing vessels, as in the nature of subsidies for the encourage- 
 ment of commerce and ship-building ; and if they were subsi- 
 dies, their influence did not drive the Americans from the 
 ocean, or have any marked effect in expanding British ship- 
 ping. Second. Previous to i860 Great Britain paid as much 
 as $5,000,000 in a single year for the transportation of her 
 mails to and from the mother-country and its colonies, and 
 foreign ports and dependencies. For the year ending March 
 31, 1889, the British Post-oflfice Department, according to its 
 report presented to Parliament, expended in all, for " con- 
 veyance " by land and by water, and by all agencies, the sum 
 of ;^ 1, 9 1 6,69 1 ; and as it is under this head that the so-called 
 and much-talked of English steamship subsidies must be 
 found, if found at all, an analysis of the items of such expen- 
 diture is of the first importance. And, instituting such an 
 analysis, it appears that out of the above aggregate ^903,634 
 was paid to British railway companies, and ;^637,502 ($3,100,- 
 859) to steamship lines for mail conveyance ; but of the latter 
 sum, the " foreign market service " of steamships received 
 ;^5 16,173 (o*" $2,508,590). If there was any thing in the na- 
 ture of subsidy in this expenditure, it is clear, therefore, that 
 the railways received the major portion ; and that the com- 
 paratively pitiful sum of some three millions of dollars is all 
 
32 THE DECAY OF OUR OCEAN MERCANTILE MARINE, 
 
 that the friends of subsidies can legitimately claim that Great 
 Britain expended in 1888-89 for the support and encourage- 
 ment of her immense ocean mercantile marine. 
 
 A word next in reference to certain expenditures by the 
 British Admiralty, which are occasionally and somewhat 
 mysteriously referred to as in the nature of important 
 gratuities for the encouragement of British shipping. The - 
 simple facts in this case are as follows : The British Admir- 
 alty, independent of the Post-office Department, and with- 
 out reference to any conveyance of mails, has paid, in re- 
 cent years, under the head of war expenditures, compara- 
 tively small sums on account of certain steamships, on con- 
 dition that they should be so constructed as to permit the 
 carriage of heavy guns, and be made otherwise available as 
 war cruisers, and thus modified be held at the disposal of 
 the Government at all times, for purchase or hire, at the 
 option of the Admiralty. The primary cost of such vessels 
 being thus considerably increased, and their modified con- 
 struction being also antagonistic to their most profitable 
 employment in passenger or freight service, the British Gov- 
 ernment, of necessity, is obliged to make compensation for 
 such losses. But upon what close calculations such com- 
 pensation is rendered is made evident by the fact that, for 
 the year 1888 the total expenditure for such purpose was 
 only ;^22,38o, while for the year 1889 an expenditure of 
 ;^39,4io was estimated. For the year 1885 the amount 
 thus expended was much larger, namely, about ;^6oo,ooo. 
 
 On the other hand the Post-office Department of the 
 United States expended for the conveyance of the mails — 
 mainly by land— in 1887-88, the large sum of $31,456,000, 
 or more than seven times as much as Great Britain pays 
 for a like service ; but no one pretends that this great ex- 
 penditure was a subsidy paid for encouraging the building 
 and use of American railway tracks, bridges, cars or loco- 
 motives, and yet it was a subsidy to our railroads in exactly 
 
THE DECA Y OF OUR OCEAN MERCANTILE MARINE. 33 
 
 the same sense as the much smaller similar expenditure of 
 Great Britain was a subsidy to her shipping. 
 
 How the British government, moreover, entirely subor- 
 dinates whatever payments it may make for its ocean 
 marine service to the interests of the empire — its colonies, 
 its foreign dependencies, and military and naval stations — 
 rather than to its trade interests, is strikingly illustrated by 
 the way in which such payments are distributed. Thus 
 England's trade with Europe is very much greater than her 
 trade with Asia ; but she paid to the lines of steamers run- 
 ning to ports in Asia in the year 1888-89 for the convey- 
 ance of her mails ^435,800, while to the lines plying 
 between England and European ports she paid during the 
 same year but ;^ 17,700, and this latter payment was en- 
 tirely confined to the channel steamers running between 
 Dover and Calais, and Dover and Ostend. The simple and 
 truthful explanation of this is, that there are English colo- 
 nies and military and naval stations in Asia, but none in 
 continental Europe. Again, the United States and the 
 West Indies are two c'ountries about equally separated from 
 England. With the former England's trade is seventy-five 
 times greater than with the latter ; but the steamers per- 
 forming service between England and the West Indies in 
 the year 1888-89 were paid £go,^'^o, while those carrying the 
 mails between England and the United States during the 
 same year were paid but ;£^85,ooo. If any man, after a 
 comparison of these figures, can wrest from them an inter- 
 pretation that England's motive in paying thus extrava- 
 gantly for the transport of her West India mails, was to 
 build up her ocean marine, rather than maintain the in- 
 tegrity of her empire, and keep up regular and efficient com- 
 munication with her colonies, he will be entitled to extra- 
 ordinary credit for ability to manipulate figures in such a 
 way as to deduce from them any conclusion antagonistic to 
 the truth that he may think expedient. The precise object 
 
34 THE DEC A Y OF OUR OCEAN MERCANTILE MARINE. 
 
 which the Government of the United States has had in 
 view in connection with its liberal grants of money and 
 land to the great transcontinental railway lines — namely, 
 to knit the widely separated portions of its dominion more 
 closely together — ^has been aimed at by the British Govern- 
 ment in its large contributions during the last forty or five- 
 and-forty years to its various mail steamship lines which 
 have united the colonies as never before with the mother- 
 country. The nature of the service, both to the East and 
 West Indies, has always been peculiar and exceptional, and 
 still continues to be so ; and more than three fourths of the 
 whole cost of the present ocean marine service is expended 
 upon those two routes. 
 
 And here we find an explanation of a recent circum- 
 stance — namely, the reported grant by the British Govern- 
 ment of ;^6o,ooo per annum to a steamship line, to run in 
 connection with the Canadian Pacific R.R. from Vancouver 
 to Hong Kong, which has been regarded as conclusive 
 evidence that Great Britain builds up her ocean marine by 
 subsidies. The Canadian Pacific, htDwever, was built pri- 
 marily, not for traffic purposes, but as a political necessity, 
 to bind together the widely separate provinces of the 
 Dominion of Canada ; and immense contributions of land 
 and money were made by the Colonial Government to 
 effect its construction. Once completed it opened a new, 
 cheap, and expeditious route to the East, which England 
 could control and use for the transportation of troops and 
 'munitions of war, as well as for postal service to India 
 and Australia, in case European or Egyptian complications, 
 which are always threatening, should close to her the Suez 
 Canal. Her encouragement to the new line of steamers in 
 question was, therefore, clearly dictated by military and 
 not by mercantile considerations. 
 
 Again, it has been proposed during this present year 
 (1889) to establish a new transatlantic fast line between 
 
THE DECAY OF OUR OCEAN MERCANTILE MARINE. 35 
 
 England and Canada, on the basis of a government bonus 
 of half a million of dollars per annum. Such a compensa- 
 tion seems very large, and as having clearly for its object the 
 encouragement of British shipping, but an examination of 
 details showed that the proposed new line was not intended 
 to be a freight-carrying line, but to carry passengers and 
 mails primarily and almost exclusively ; that the bonus 
 was to be no assistance in moving British and Canadian 
 products to a market ; and, finally, that large as the bonus 
 was, it was wholly insufficient to support a passenger line, 
 pure and simple. The enterprise in question, therefore 
 has, at least for the present, been abandoned. 
 
 It is not to be overlooked in this connection that certain 
 of the British colonial governments do make compensation 
 to certain ocean steamship lines independent of the home 
 government ; but this is done for the purpose of obtaining 
 greater facilities for mail conveyance and for immigration, 
 and not for the purpose of developing any shipping interest. 
 Such compensation, for example, has been paid by New 
 Zealand to steamships owned by Mr. Spreckles, an American 
 citizen ; and another line of American steamers receives pay- 
 ment from Brazil. 
 
 No little of confusion and misapprehension has attended 
 the discussion of this subject, by reason of the different 
 usage and signification of the term " subsidy " in the 
 United States and Great Britain. In the former the terms 
 " subsidy " and " bounty " are used as having an equivalent 
 meaning ; and when a subsidy is proposed it is generally 
 understood to be in the nature of a bounty for the purpose 
 of helping the owners of steamships to make a living, or 
 earn profits. In the latter no payments are made by the 
 Government to any steamships — other than the compara- 
 tively trifling Admiralty subventions above noted — except 
 for the conveyance of its mails — an obligation as legitimate 
 and as incumbent upon all nations desirous of maintaining 
 
36 THE DECA Y OP OUR OCEAN MERCANTILE MARINE. 
 
 correspondence with foreign countries, as are payments for 
 the performance of similar service by railroads and other 
 instrumentalities on land. But such payments in Great 
 Britain, although spoken of as subsidies, are not bounties, 
 or regarded as such by her Government or her people. 
 
 Great Britain, furthermore, pays no more to her ships than 
 a fair commercial price for the service they render ; and the 
 fact that all contracts for such service are always made 
 after public advertisement and public competitive tenders 
 on the part of all persons, native or foreign, who may de- 
 sire to participate in the service, excludes the possibility of 
 there being any thing in the nature of a benefaction or 
 bounty, which could alone be authorized by direct and spe- 
 cific enactment of Parliament. 
 
 The statement that is also constantly made, that because 
 the subsidies paid by England to English steamships en- 
 able them to carry English-manufactured commodities 
 cheaply to her dependencies and foreign nations, therefore 
 mercantile competition with England on the part of the 
 United States in like business is impossible, is equally 
 destitute of foundation. 
 
 In 1888 Great Britain owned seven twelfths of the 
 world's shipping, and 70 per cent, of the world's 
 steam-tonnage ; but out of this immense aggregate, not 2 
 per cent, performs any direct service for the British Govern- 
 ment, or receives one farthing per annum from its Treasury 
 in the way of payment for any thing. . -And yet the advo- 
 cates of the subsidy policy in this country would have the 
 American people believe that it is the employment of this 
 small fraction of her marine tonnage by the British Govern- 
 ment for mail service, and on the compensation for which 
 not more than an average of 5 per cent, profit is probably 
 realized, that makes Great Britain mistress of the seas, and 
 gives her manufacturers advantages over American com- 
 petitors in dealing with foreign countries. 
 
THE DECA Y OF OUR OCEAN MERCANTILE MARINE. 37 
 
 Up to about 1850-51, the problem whether any ocean 
 steamship could be navigated at a profit was a doubtful 
 one. But in 185 1 all doubt on the subject having been re- 
 moved, Mr. John Inman, an English capitalist and mer- 
 chant, possessing no more information or facilities than 
 were available to other competitors, started his line of 
 transatlantic screw steamers, which were to carry general 
 cargoes and emigrant passengers, and be independent in 
 every respect of the British Admiralty or Post-office. And 
 from that time to this there has been a constant succession 
 of other lines put in operation which have been pre-emi- 
 nently successful, and which have never received Govern- 
 ment aid of any kind, — not even compensation for ocean 
 postal service. And these facts, which cannot be ques- 
 tioned or denied, also conclusively demonstrate the un- 
 soundness of the assertion on the one hand, that the pres- 
 ent great development and supremacy of British ocean 
 navigation is due to the continued payment of subsidies 
 by the Government ; and on the other, that Government 
 aid in the way of subsidies is, and has been, necessary for 
 the resuscitation of the American mercantile marine, unless 
 it is at the same time assumed that the Americans are an 
 inferior race, and are unable to do under equal circum- 
 stances what the Englishman has found no difficulty in 
 accomplishing. And if circumstances have not been equal, 
 it is because our navigation laws and fiscal policy would not 
 permit it. 
 
 A further point of importance should also not be over- 
 looked by those desirous of getting at the truth of this 
 matter. The sailing fleet of Great Britain is the largest in 
 the world, and in 1888 numbered 15,025 vessels, represent- 
 ing over three millions of tons ; but not one of these vessels 
 is employed by the British Government. In general, 
 however, they engaged in profitable ocean service, while 
 our sailing vessels are rapidly decreasing in number because 
 
38 THE DEC A Y OF OUR OCEAN MERCANTILE MARINE. 
 
 they are unprofitable. And yet no one can deny that the 
 same opportunities of freight in the general ocean-carrying 
 trade are open to British and American sailing ships, 
 excepting that the latter have the advantage of being pro- 
 tected in their coastwise trade, while the coasting trade of 
 Great Britain is open to all nations. And this statement 
 alone ought to be convincing that the British carrying 
 trade on the ocean is not maintained and made prosperous 
 by subsidies. 
 
 The utter want of all similarity between the ocean ser- 
 vice which private-owned steamships render to the British 
 Government and the object for which it is proposed to pay 
 subsidies to shipping in this country should not be over- 
 looked. In the one case payments are made for service, 
 based on contracts awarded after public competition. In 
 the other a subsidy is to be given on the basis of the 
 mileage sailed. In the former the prime object proposed 
 for attainment is the carrying of letters ; in the other the 
 sailing of the ship or the carrying of the flag. There is 
 something very sentimental and captivating in the assertion 
 that " trade follows the flag. " But trade does nothing of 
 the kind. It follows the dollar wherever it is to be found, 
 and in the attainment of this object the question of the flag 
 to those concerned in the trade is a matter of very little 
 consideration. Goods seeking transportation will never 
 wait long upon a dock, because the vessel moored to its 
 side and ready and capable of transporting them carries a 
 foreign flag. 
 
 Finally, when England's record in this matter is 
 examined, it becomes apparent that her so-called subsidy 
 policy has no characteristics antagonistic to the principles 
 that underlie and govern all correct and shrewd business 
 transactions. She subsidizes ships in the same sense as 
 the citizen subsidizes the butcher, the baker, the grocer, and 
 the dry-goods merchant ; that is, she avails herself of the 
 
THE DECA Y OF OUR OCEAN MERCANTILE MARINE. 39 
 
 services of a very small proportion of her ships and ship- 
 owners for carrying her mails and pays them for it in 
 exactly the same way as the United States pays railroad, 
 steamboat, and stage owners for performing similar service. 
 ^And in all her history Great Britain has never appropriated 
 a dollar for the purpose of aiding in the construction and 
 employment of a British merchant-ship,) and no person can 
 point to a single act of Parliament that ever gave a bounty 
 or subsidy for such purpose. The testimony of all British 
 authorities runs to the same effect. Thus, in 1881, the 
 late Mr. Henry Fawcett, M.P., then British Postmaster- 
 General, declared explicitly that " a postal subsidy is simply 
 a payment made for the conveyance, under certain specified 
 conditions as to time and speed, of postal matter " ; that 
 " such subsidies are not granted with the object of giving 
 to English shipping any protection against the competition 
 of the shipping of foreign countries," and mentioned as 
 proof of the correctness of this assertion, " that when a 
 contract for the conveyance of mails is advertised, no 
 restriction whatever is imposed upon any foreign vessels 
 competing," and that " the subsidy would be paid to foreign- 
 owned and foreign-built vessels if it was considered that the 
 best and cheapest service could be thus secured." 
 
 The largest amount specifically paid by the British Govern- 
 ment for ocean service is to the so-called " Peninsular and 
 Oriental Steamship Company," which carries the mails. 
 Government despatches and messengers between England 
 and the East, and the receipts and experience of this 
 company are often cited as evidence that England not only 
 called it into existence, but has always maintained it by 
 the payment of subsidies, in the American acceptation of 
 the term. But on this point Mr. W. H. Lindsay, the lead- 
 ing authority on English shipping, speaks thus decisively : 
 
 " The impression," he says, " that this company owed its origin 
 to Government grants, and that it has been maintained by sub- 
 
40 THE DECAY OF OUR OCEAN MERCANTILE MARINE. 
 
 sidies, is not supported by facts. Whether the company would 
 have continued to maintain its career of prosperity without Gov- 
 ernment subsidies, is a problem too speculative for me to solve. 
 Free from the conditions required by Government, the company 
 would probably have done better for its shareholders had it been 
 also at liberty to build and sail its ships --it pleased, despatching 
 them on such voyages and at such rates of speed as paid it best ; 
 and in support of this opinion I may remark that various other 
 shipping companies, with no assistance whatever from Govern- 
 ment, have yielded far larger dividends, than the Peninsular and 
 Oriental Company ; and further, that private shipowners who never 
 had a mail bag in their steamers have realized large fortunes." 
 And again, commenting on the large payments made to this line 
 by the Government, he says : " From whatever cause it may have 
 arisen, the fact is apparent that, though the annual gross receipts 
 of the company are enormous, its expenditure is so great that less 
 balance is left for the shareholders than is usually divided among 
 those undertakings of a similar character which receive no assist- 
 ance from Government, but are free to employ their ships in 
 ■whatever branch of commerce they can be most profitably em- 
 ployed." — Lindsay's Merchant Shipping. 
 
 The late Mr. Guion, founder of the Williams & Guion 
 line of steamers, has also placed himself on record, that his 
 company " never received a penny of Government subsidy 
 and felt no necessity for it." 
 
 Within the last year the British Post-office authorities have 
 made a contract with the North German Lloyd for a regular 
 mail service between Southampton and New York, in 
 preference to employing the Cunard and White Star lines, 
 for the reason that the Government could effect a saving 
 under the new arrangements to the reported extent of £2^,- 
 000 per annum. Commenting on the change, Mr. John 
 Burns, of the Cunard Company, in a recent communication 
 to the London press made the following statements : 
 
 " Whatever the saving made by the employment of the North 
 German Lloyd ships may be, the acceptance by this company of 
 
THE DECAY OF OUR OCEAN MERCANTILE MARINE. 4I 
 
 lower rates than English companies is accounted for by the fol- 
 lowing considerations : i. They enjoy a large subsidy from their 
 own Government, an advantage denied to British ships. 2. They 
 are not subject to the restrictions and regulations of British law. 
 3. They have not to call and wait at Queenstown. 4. They call 
 at Southampton on their way from Bremen to New York in order 
 to compete for British trafBc. Whatever they can obtain for the 
 carriage of the mails is therefore practically so much clear gain, 
 and helps them in their war on British trade." 
 
 So according to Mr. Burns, who must be recognized as 
 authority, the British Government at the present time (what- 
 ever it may have been before), in place of encouraging, is at 
 war with British trade. 
 
 In short, all this attributing the maritime prosperity of 
 England to subsidies is a concealment of a truth that it is of 
 the utmost importance for the American people to learn, 
 namely, that England is first in shipping, because she is 
 first in commerce ; and she is first in commerce, because she 
 has freed her trade and her ships, while the United States 
 have shackled the one and destroyed the other. 
 
 So much then for the experience of Great Britain in 
 respect to her so-called subsidy policy. On the other hand, 
 there is no doubt that certain of the continental nations of 
 Europe have in recent years attempted to stimulate ship- 
 building and ship-using by a carefully devised system of 
 subsidies, in the nature of bounties, the same substantially 
 as it is now proposed shall be adopted by the United States. 
 The results of these experiments have thus far been com- 
 plete failures ; and as France has taken the lead in this 
 policy, and most thoroughly carried it out, attention is 
 especially asked to the following record of her experience. 
 
 In 1 88 1, the French Government oflered to give a bounty 
 of twelve dollars a ton on all ships built, in French yards, 
 of iron and steel ; and a subsidy of thirty cents per ton 
 for every thousand miles sailed by French vessels ; and as 
 
42 THE DEC A Y OF OUR OCEAN MERCANTILE MARINE. 
 
 they did not desire to put any inhibition on the citizens of 
 France buying vessels in foreign countries and making them 
 French property, in case they desired to do so, they proposed 
 to give one half the latter subsidy to vessels of foreign con- 
 struction bought by citizens of France and transferred to the 
 French flag. 
 
 At the outset, the scheme worked admirably. New 
 and expensive steamship lines were organized with almost 
 feverish haste, and the construction of many new and large 
 steamers was promptly commenced and rapidly pushed for- 
 ward in various French ports, and also in the ship-yards of 
 Great Britain and other countries. The Government paid- 
 out a large amount of money, and it got the ships. In two 
 years their tonnage increased from a little over 300,000 to 
 nearly 700,000 tons for steamers alone ; while the tonnage 
 engaged on long voyages increased in a single year from 
 3,600,000 to over 4,700,000 tons. 
 
 It was probably a little galling to the French to find out 
 after two years' experience that most of the subsidies paid 
 by the Government were earned by some two hundred iron 
 steamers and sailers, and that over six tenths of these were 
 built and probably owned in large part in Great Britain ; 
 so that the ship-yards on the Clyde got the lion's share of 
 the money. But as all the vessels were transferred to and 
 sailed under the French flag, and were regarded as belong- 
 ing to the French mercantile marine, every thing seemed to 
 indicate that the new scheme was working very well, and 
 that the Government had really succeeded in building up 
 the shipping of France. But the trouble was that the 
 scheme did not continue to work. The French soon learned 
 by experience the truth of the economic maxim that ships 
 are the children and not the parents of commerce ; and that 
 while it was easy to buy ships out of money raised by tax- 
 ation, the mere fact of the ownership of two or three hun- 
 dred more ships did no more to increase trade than the pur- 
 
THE DECA Y OF OUR OCEAN MERCANTILE MARINE. 43 
 
 chase and ownership of two or three hundred more plows 
 necessarily increased to a farmer the amount of arable land 
 to plow ; or, in other words, the French found that they had 
 gone to large expense to buy a new and costly set of tools, 
 and then had no use for them. 
 
 And, what was worse, they found, furthermore, that while 
 they had not increased trade to any material extent, they 
 had increased the competition for transacting what trade 
 they already possessed. The result has been that many 
 French shipping companies that before the subsidy system 
 were able to pay dividends are no longer able ; fortunes 
 that had been derived from the previous artificial prosperity 
 have melted away, and the French mercantile marine ceased 
 to grow — only $601,120 being paid out for construction 
 bounties in 1886, as compared with a disbursement of 
 $908,000 in 1882. In fact, the whole scheme proved so dis- 
 astrous a failure that the late Paul Bert, the eminent French 
 legislator and orator, in a speech in the French Assembly, 
 seriously undertook to defend the French war of invasion 
 in Tonquin on the ground that its continuance would afford 
 employment for the new French mercantile marine, which 
 otherwise, we have a right to infer, in his opinion would 
 have remained idle. A recent writer — M. Raffalovich — in 
 the Journal des Economistes has also thus summed up the 
 situation. " It may be asserted," he says, that " the bounty 
 system in France, which was intended to bridge over a tem- 
 porary depression, has aggravated the situation, and has 
 proved itself to be a source of mischief, not of cure." 
 
 The experience of the mercantile marines of Europe also 
 affords the f oUowingcurious results during the eight years prior 
 to 1 880 and before the inauguration of the French bounty sys- 
 tem. French shipping, in its most valuable branch-steamers, 
 increased faster than the shipping of any of its Continental 
 competitors; but after 1880, the increase in the steam ma- 
 rine of Germany, where no bounties were paid, was relatively 
 
44 THE DECA y OF OUR OCEAN MERCANTILE MARINE. 
 
 greater both in number and tonnage of vessels than in 
 France where large bounties were given after 1881 ; and 
 was also greater as respects the aggregate tonnage of all 
 vessels — sail and steam. The obvious expectation of the 
 French Government in resorting to the bounty system for 
 shipping was that ships built and navigated with the aid of 
 the bounties would carry French manufactures into foreign 
 countries, and thus open new markets for domestic prod- 
 ucts. But experience, thus far, has shown that all that has- 
 been effected is a transfer, to some extent, of the carriage of 
 goods formerly brought in foreign vessels to French vessels ; 
 while, on the other hand, the increase of tonnage, under the 
 stimulus of the bounties beyond the requirements of trafiSc 
 and the consequent reduction of freights, has entailed " a 
 loss, and not a gain, to the French nation, by throwing 
 upon it the burden of a shipping interest that, but for the 
 Government aid, would have been unprofitable, and which, 
 because of such aid, can not conform itself to the demands 
 of trade." 
 
 The experience of Austria-Hungary in attempting to find 
 new outlets for their produce, or fresh employment for their 
 shipping by the payment of subsidies, has been analogous 
 to that of France, and equally unfortunate. The steamers 
 of the Austrian Lloyd Company have made more voyages 
 to the " Far East " than when unsubsidized ; but the ex- 
 ports of Austrian products have not materially increased, 
 while the mercantile marine generally of Austria is rapidly 
 declining. 
 
 Contrast these results with the experience that has ac- 
 companied the free ships and free commercial policy of 
 Great Britain. Of the total increase in the shipping trade 
 of the principal maritime nations from 1878 to 1887, one 
 third occurred in British tonnage ; while of the increase in 
 the merchant steam tonnage of different countries, during 
 the same period, nearly two thirds is to be credited to Great 
 
THE DECA Y OF OUR OCEAN MERCANTILE MARINE. 45 
 
 Britain. In the year 1887 the mercantile navy of Great 
 Britain, while carrying three fourths of the whole of her 
 own immense commerce, carried at the same time one half 
 of that of the United States, Portugal, and Holland ; nearly 
 one half of that of Italy and Russia ; and more than one 
 third of that of France and Germany. As the ocean mer- 
 cantile tonnage of the United States declined between the 
 years 1878 and 1887 in a greater degree than that of any 
 other country, it is very clear at. whose expense the increase 
 in the shipping of other nations was made during this 
 same period. 
 
 REMARKS OF MR. WILLIAM J. COOMBS. 
 
 I have been invited to follovir the eloquent paper which has been read to us 
 this evening, by a fevc extemporaneous remarks. I have consented for the 
 reason that I quite well understand that your object in inviting me to speak, is 
 to get the merchants' view of the question, and to come into possession of such 
 facts in my experience as may bear upon the situation. 
 
 It is undoubtedly a subject for deep mortification that a great nation like 
 ours, which at one time was able to dispute the dominion of the seas with the 
 strongest maritime powers, should at this time of general prosperity be without 
 a mercantile marine. If we look for the cause of this condition, we shall not 
 find it in the poverty of the country or in its lack of resources, but in unwise 
 restrictive legislation, which has made it impossible for us to avail ourselves of the 
 splendid resources that nature and the enterprise of our people have put at our 
 disposal. I shall not attempt to argue this evening, whether or not this legisla- 
 tion was wise and proper at the date of its conception ; there may easily be a 
 difference of opinion upon this point, and it is not worth our while to waste time 
 upon it, — what we have to do with, is the present and the future. If we find 
 that these laws were enacted to meet requirements and conditions which 
 no longer exist, and that they fetter us now under our new conditions, and make 
 it impossible for us to keep pace with the nations of the earth, so that we are 
 daily losing our supremacy, it becomes our duty not only to ask, but to demand 
 their repeal. 
 
 In my opinion, the question of free ships is at present a matter of secondary 
 importance, — there are questions antecedent to that which should claim our 
 attention, and the settlement of which, if properly made in the interests of 
 commerce and of the general good, will carry with it the cure of all these minor 
 errors. I believe that if we to-day had a mercantile marine given to us, free of 
 
46 THE DECAY OF OUR OCEAN MERCANTILE MARINE. 
 
 cost, we could not sustain it and make it profitable. In order to run ships, 
 either sail or steam, at a profit, there are two things that are certainly necessary, 
 viz., outward cargoes and return cargoes. I claim and can prove from my 
 experience, that we have settled the first half of this problem, but that the second 
 half is unsettled, and is the cause of our present embarrassment. Not only does 
 it make it impossible for us to compete for the carrying trade of the world, but 
 it prevents our shipping, upon any reasonable terms, the products of our facto- 
 ries and fields. 
 
 The time has come when the enterprise of our manufacturers, combined with 
 the intelligent skill and inventive genius of our mechanics, enables us to 
 compete in the markets of the world with the European factories, as regards 
 nearly every class of our industrial productions. The exceptions are so few, that 
 they can be easily enumerated, and consist in most part of those articles in which 
 the cost of the raw material constitutes the most important item. We compete 
 most successfully in the classes of goods in which the item of labor is the largest 
 factor. However, we find ourselves in the position of the farmer who has tilled 
 his fields and raised his crop, but who has failed to provide wagons in which to 
 carry it to its destination. 
 
 The thing which now gives the merchant who sells to foreign markets the 
 greatest anxiety, is to procure vessels, either American or foreign, at reasonable 
 rates of charter, to carry the goods to his customer after they are sold. In this 
 particular, he is at a great disadvantage as regards his European competitor. The 
 owner of a vessel who charters it for a voyage to Buenos Ayres or the Cape col- 
 onies, does so with no expectation of getting a return cargo to this port, but 
 calculates upon taking one from there to Europe. If he wishes to return to this 
 country, he must, except under unusual circumstances, come back in ballast. 
 His rate of charter is fixed upon this basis. As an example I will state that to- 
 day we received a letter from the captain of a vessel which we loaded for Natal, 
 Africa, — informing us of his intention to proceed in ballast to Brazil to take 
 cargo for New York. 
 
 Our house has repeatedly within the present year, chartered vessels in 
 foreign ports to come to this country in ballast, in order to take away merchan- 
 dise for which we had orders. At the present moment we have six of such 
 charters pending. This not only involves long delays but enormously increases 
 the cost ; and for both reasons, puts us at a great disadvantage in comparison 
 with our European rivals. This is a state of things which the law of supply and 
 demand would remedy, were it not for our unwise restrictive legislation, by 
 which we are prevented from receiving certain classes of raw material which our 
 manufacturers need, and which would furnish excellent return cargoes for our 
 vessels. 
 
 There is a proposition pending, — ^which will without doubt be pressed before 
 the Congress soon to convene, to remedy this by a system of subsidies and 
 bounties, but I venture to assert that unless our government is prepared to grant 
 assistance to at least the approximate amount of the freight of a return cargo, 
 
THE DECAY OF OUR OCEAN MERCANTILE MARINE. 47 
 
 it will not have the desired effect. It will open the way for a vast amount of 
 jobbery and corruption, and at the best will only be a temporary expedient, a 
 correction of one error by the commission of another. Government can very 
 materially and legitimately assist any proposed steamship line by paying liberally 
 for the transportation of mails. Those lines already established have had just 
 cause for complaint on account of insufficient remuneration. Such assistance is 
 all the more proper, for the reason that carrying the mails is one of the things 
 which by general consent is left for the Government to do. 
 
 During my canvass for Congress in 18S8, I often pointed out what I con- 
 sidered to be the first step in the right direction, to-wit ; the removal of the 
 almost prohibitory duty on South American and Cape wool. This would give 
 our woollen manufacturers what they sorely need, and, I verily believe, would put 
 them in a position to compete with the European manufacturers in the markets 
 of the world — which they are now unable to do. During the election of 1888 
 they resisted the attempt, but already wiser counsels begin to prevail, and the 
 time is not far distant when the demand will become imperative, and will have 
 to be conceded, if it is not complicated by other claims. It will, I am sure, be 
 found that such action will not injure our own wool-growers, but will result in 
 a more active market for all the wool that we can produce under favorable cir- 
 cumstances. If the duty is removed I believe that, within two years, any 
 attempt to impose it would be met with the same derision which was encoun- 
 tered by a similar proposition in relation to hides. 
 
 I might go on and enumerate other raw materials from which the duty should 
 be removed, but I believe that it is good policy to leave them, for the present, 
 out of the discussion. I think that a very serious error has been made by 
 revenue reformers in attempting too much at a time, and thus banding all the 
 selfish interests in a common defence. If we can succeed in breaking their 
 forces by securing the adoption of a proper policy in relation to one important 
 item, we shall soon have other things falling into line. For that reason I would 
 not disturb the present duties on manufactured goods, except in cases where 
 protection has led to the formation of trusts and combinations against the public 
 interests. Already they have, in a great variety of cases, become like the weeds 
 in the bottom of the channel : the tide has risen above them. Except in the 
 cases mentioned, they will not materially interfere with our prosperity. The 
 great competition, engendered by success, has had its natural result in over- 
 production, thus giving back to the people the benefit of reasonable prices. 
 
 The scales are now very evenly balanced between our own and the European 
 manufacturers, with a decided tendency to dip in our direction. If we can suc- 
 cessfully compete even to a limited extent, embarrassed as we are by duties on 
 our raw materials and by dear transportation, what could we not do, with free 
 raw materials and proper facilities for the cheap delivery of our goods ? With 
 these given to us by the repeal of unwise legislation, our manufacturers could 
 successfully compete for the trade of the world ; they could vastly increase the 
 capacities of their factories ; skilled workmen would be in demand, at remunera- 
 
4$ THE DECA Y OF OUR OCEAN MERCANTILE MARINE. 
 
 tive wages, and would in a measure replace the foreign and unskilled laborer* 
 who are now employed in our mines in providing the raw materials, — thus the 
 average quality of our citizenship would be raised. The agricultural interests of 
 the country, whose foreign markets are now seriously threatened by new com- 
 petitors in the raising of grain, would find a better and more remunerative home 
 market. This is not a fanciful picture ; on the contrary, the result predicted is 
 clearly within our reach. 
 
 I cannot prolong my remarks indefinitely, as I have already trespassed too far 
 upon your time ; I will detain you only enough to urge upon you — and through 
 you upon every good citizen — not to delay action too long. 
 
 We are accustomed to look upon the prosperity of our country as iinassailable, 
 to imagine that we have in some way a patent upon success. We must not 
 be deluded by this idea. The time was, when we were the foremost nation in 
 rapid progress. If we look around, we will see that the whole world has. 
 awakened to activity. Fresh competitors are springing up in all directions, 
 and nations that have been asleep have risen to a new life. Under the cir- 
 cumstances, to stand still is relatively to go backwards ; to adhere to old and 
 crude methods at the time of a general advance, is suicidal. A selfish and 
 grasping policy, by which we seek to secure every thing without giving any thing 
 in return, should debar us from the sympathies, as it surely will from the general 
 prosperity, of the world. 
 
SHIPPING 
 SUBSIDIES AND BOUNTIES 
 
 A REVIEW OF THE PLEA FOR THE FURTHER PROTECTION OF THE 
 
 SHIPBUILDING MONOPOLY MADE BY REPRESENTATIVE 
 
 NELSON DINGLEY, JR., OF MAINE 
 
 CAPTAIN JOHN CODMAN 
 
 An address delivered before the Reform Club, New York City, Friday 
 evening, Nov. 15, 1889 
 
SHIPPING SUBSIDIES AND BOUNTIES. 
 
 An article entitled " How to Restore American Shipping," 
 in the North American Review for June, will have been ex- 
 tensively read, because the public are aware that its author 
 has for several years, under Republican rule, held the posi- 
 tion of chairman of the Shipping Committee in the national 
 House of Representatives. Everybody will say that he 
 ought to be fully conversant with the matter, that his state- 
 ments ought to be undeniable, that his inferences ought to 
 be correct, and that his plans for restoring the merchant 
 marine to its former condition of prosperity ought to be 
 such that their value should be appreciated and their method 
 adopted. With all the deference due from a practical man 
 to a theorist, I propose to investigate the reliability of what 
 he considers to be facts, leaving his inferences to stand or 
 fall accordingly, and to discuss the value or the insufficiency 
 of his remedies. At the outset it is only just to define our 
 relative positions. Mr. Dingley happens to be a repre- 
 sentative from a shipbuilding district of Maine, sadly in want 
 of rehabilitation. In his article he is, as he has always been 
 in all his speeches and writings, first and foremost the advo- 
 cate of the domestic shipbuilding industry, which he con- 
 siders to be a sine qua non for the development of our com- 
 merce and carrying trade. " The trade follows the flag " is 
 his stereotyped motto, and in order that it may follow it 
 successfully, it is with him a necessity that the ship over 
 which the flag floats should be built of American wood or 
 iron, and launched upon American waters. On the other 
 hand, having been a sailor, and the principal part of my life 
 
 I 
 
2 SHIPPING SUBSIDIES AND BOUNTIES. 
 
 having been passed as a shipmaster and shipowner, I opine 
 that commerce and the carrying trade are of infinitely greater 
 importance than shipbuilding ; that the apothegm of 
 " the trade following the flag " is a fallacy demonstrated by 
 every-day experience, and that, although it is desirable that 
 we should build ships at home, it is poor policy as well as 
 gross injustice to our merchants and sailors to surrender our 
 carrying trade to other nations, whom we directly protect in 
 conducting it while nominally protecting our shipbuilders 
 who do not build the ships we need and to whom the stim- 
 ulus of competition is wanting, which, if introduced by the 
 presence of " free ships " from abroad, would soon enable 
 them to supply all our demands. 
 
 No small part of Mr. Dingley's essay is devoted to com- 
 mending to us the example of England of " fostering " her 
 domestic shipbuilding, and to giving us his own erroneous 
 impressions of that entirely imaginary process. He always 
 carefully abstains from referring to her wise policy in abol- 
 ishing her restrictive navigation laws in the year 1849, when, 
 in order to prevent a condition like our own at present, and 
 to maintain her prestige in the world's carrying trade which 
 she rightly considered to be of more importance to her than 
 her shipbuilding, she repealed all her prohibitory statutes by 
 an act of Parliament, thus abrogating her old laws and per- 
 mitting her merchants to supply themselves with ships 
 wherewith to carry on their business and to employ their 
 crews, from any source from which ships could be obtained 
 with advantage. Of course there came a howl from her 
 shipbuilders. It was louder than the wail for protection 
 which we are always hearing from ours, because the British 
 shipbuilders were more numerous. But the question before 
 Parliament was not how shall those individuals who are en- 
 gaged in a particular industry be affected, but how shall the 
 supremacy of the British flag, then sorely threatened by the 
 competition of American clippers, be maintained ? These 
 
SHIPPING SUBSIDIES AND BOUNTIES. 3 
 
 questions were asked : " Is it not better that British mer- 
 chants should buy those American ships in order to carry 
 on their trade, than that they should abandon it in favor of 
 the Americans? Is it not better that British officers and 
 seamen should have employment in vessels wherever built, 
 than that Americans of a similar calling should take the 
 bread from their mouths?" As to the shipbuilders, they 
 were told to bestir themselves, to build ships equal to those 
 about to be introduced, no fear being entertained by the 
 government that competition would not bring about that 
 result. It is a curious fact that whereas our American ship- 
 builders of to-day are asking for charity because they say 
 that they are unable to compete with the "pauper labor " of 
 Great Britain, the English shipbuilders of that period re- 
 monstrated against free ships from America, because, as 
 they said, " the labor on that side of the Atlantic is more 
 intelligent than our own, and consequently, cheaper as 
 well as better ships can be produced in America." A com- 
 parison of labor statistics will show, however, that ship- 
 building labor, as well as labor employed in sailing the ves- 
 sels, was relatively higher in the United States than it is 
 now over that of the English. Then we were living under 
 an exceptionally low tariff. Now the tariff is exceptionally 
 high. It would, therefore, certainly seem that if tariffs have 
 any effect on the price of labor, a low tariff enhances it and 
 a high tariff depreciates it. 
 
 The British shipbuilders of 1849 thought that they were 
 an ill-used set of men. But while they growled a great deal, 
 they accepted the inevitable. After the repeal of the pro- 
 hibitory law, to their credit be it said, they did not petition 
 Parliament for a bounty to equalize their condition with 
 that of the Americans, but they followed the sound advice 
 that their government gave them. Thrown on their own 
 resources, they went to work. They developed a more in- 
 telligent system of labor. The unprotected Britons soon 
 
4 SHIPPING SUBSIDIES AND BOUNTIES. 
 
 surpassed the protected Americans. They improved upon 
 the pattern before them. First came the iron clipper ; then, 
 although the screw steamship was invented in America, the 
 Englishmen utilized the idea most, and now we have before 
 us the accomplishment of their perseverance, skill, and 
 adaptation of labor and machinery. The Clyde is lined 
 with shipyards. Thither go, not only all Englishmen, but 
 men of every nation (excepting of our own country, which 
 sees fit to protect itself out of competition in the world's 
 carrying trade), for their ships, precisely with the motive of 
 men who send to Cuba for their pineapples and bananas, be- 
 cause it is cheaper to buy them there than to produce them 
 at home, unless, indeed, they can prevail upon their govern- 
 ments to build for them hot-houses on the principle advo- 
 cated by Mr. Dingley. The shipbuilders of the Clyde have 
 reason to be proud of their pre-eminence, and of their " pauper 
 labor," that from evolution and practice has become more 
 intelligent than our own, which from forced disuse has fallen 
 away from the high standard of which the English once 
 complained and which they have successfully sought to 
 imitate and surpass. Dumbarton Rock stands an everlast- 
 ing monument of Scottish military glory in the olden time, 
 but Dumbarton town, built up by the enterprise of ship- 
 building, where the clatter of machinery and the stalwart 
 blows on the anvil are constantly heard, where the mansions 
 of the employers and the no less comfortable though less 
 expensive cottages owned by their contented employes, the 
 library, high school, and park maintained by private munifi- 
 cence, and all the concomitants of prosperity, may be seen, 
 is a monument in itself of success gained by the unrestricted 
 liberty of trade. In its churchyard may be seen a marble 
 slab with this inscription, written by one of the " pauper 
 workmen " in memory of his employer, once a " pauper 
 workman " himself, who became the founder of the great 
 industry of the place : 
 
SHIPPING SUBSIDIES AND BOUNTIES. J 
 
 Genius and worth are in this honored grave, 
 Here the quick brain, the active pulses lie ; 
 
 But his mind's offspring proudly breasts the wave 
 On every sea where Britain's colors fly. 
 
 The boast of this man well may have been, like the 
 boast of the house that he founded and of the men it has 
 employed, that they have made their money entirely by 
 their own " genius and worth," and that they have never 
 asked or received, directly or indirectly, one shilling from 
 their government to " foster " their industry. Mr. Dingley 
 ought to be aware of this, and he cannot be ignorant of it, 
 for he has been the chairman of the Shipping Committee in 
 Congress for years. It was his duty to keep himself informed 
 in every thing bearing upon the subject in regard to which 
 he desired to legislate, and yet he reiterates his old state- 
 ments which have been again and again demonstrated to 
 possess no shadow of a foundation, that the great shipbuild- 
 ing industrj' of England is directly " fostered " by the gov- 
 ernment by means of subsidies and bounties. This falsely 
 presumed aid of the British government leads him to 
 remark : 
 
 " Our shipping in the past has been so long subjected to 
 the unequal competition of foreign rivals that the latter are 
 firmly intrenched in all the routes of commerce, and nothing 
 but the encouragement and assistance of our government 
 for a sufficient period to enable American vessels to obtain 
 a similar position is adequate to revive this branch of our 
 merchant marine." Again we have this astonishing asser- 
 tion : " Nearly all the steamships in the leading British lines- 
 have received a permanent bounty and are subject to be 
 taken by the government for war purposes." 
 
 " Shipping " is a very comprehensive term. It comprises, 
 sailing ships as well as steamships, and independent steam- 
 ships as well as those of regular lines. In passing, it is 
 interesting to notice how rapidly sailing ships are being 
 
6 SHIPPING SUBSIDIES AND BOUNTIES. 
 
 superseded by steamers. In a late number of the Glasgow 
 Herald v^e: read: "A bulky blue-book was issued yester- 
 day containing the annual statement of the navigation 
 and shipping of the United Kingdom for the year 1888. It 
 shows amongst a vast amount of other information that 
 there were in that year registered in Scotland 17 10 sailing 
 vessels of 862,829 gross tons, and 1521 steamers of 1,609,- 
 276 tons." It is evident that as this ratio is likely to go 
 on and to increase, the death of the sailing ship is an 
 eventual certainty, and that as what little we have of deep- 
 sea shipping is of that character, when it finally disappears 
 we shall be in a worse predicament, if possible, than we are 
 now. But in the meantime Mr. Dingley's attention may be 
 called to the fact that at the present day the sailing ships of 
 Great Britain vastly outnumber her steamships, and her 
 independent steamships vastly outnumber her steamships in 
 regular lines, and her steamships in regular lines vastly out- 
 number those steamships that carry the mails. Moreover, 
 as chairman of the shipping committee, it was the duty of 
 Mr. Dingley to pursue his investigations still farther, and 
 when he had discovered that only two per cent, of the whole 
 British steam fleet receive any compensation for carrying 
 the mails, and that being considerably less than one per cent, 
 of British shipping altogether, he should have been obliged 
 to admit the total collapse of his argument that Great 
 Britain " fosters " and maintains her shipping interests by 
 "bounties and subsidies." 
 
 Nor is this all of its weakness. The pay given to this 
 small portion of the British shipping interest for carrying 
 mails has manifestly nothing to do with promoting ship- 
 building, as it is evident that a subsidized line can no more 
 induce the building of unsubsidized ships than a subsidized 
 line of stage-coaches can induce people to build unsubsidized 
 stage-coaches to run in opposition to them. The New York 
 Evening Post lately addressed a letter to the British Treasury 
 
SHIPPING SUBSIDIES AND BOUNTIES. / 
 
 to which a courteous answer was returned giving full partic- 
 ulars of its postal contracts. That reply may be found in 
 its issue of June 20th of this year, and it will afford interesting 
 reading for those people who have been led astray by the 
 oft repeated assertions of Mr. Dingley and his school of 
 political economists. I have space only for a recapitulation 
 of the sum disbursed by Great Britain for maintaining 
 regular postal service throughout her immense empire and 
 its connections. 
 
 Europe £''-1,1°o 
 
 America 202,700 
 
 Africa 13,924 
 
 Asia and Australia 434,800 
 
 Total _;^669,i24 
 
 Less repaid by colonies : 
 
 West Indies ,.;.... _;^22,36o 
 
 East Indies 63,000 
 
 Australia 7S,ooo 160,360 
 
 Net payment by the imperial government for for- 
 eign post-ofSce packet service .^^508,764 
 
 It may be added, as a clincher to the falsity of the 
 assumption that the English people of all occupations are 
 roundly taxed for the support of the one especial interest of 
 shipbuilding, that the British government receives in foreign 
 postages a sum considerably larger than it pays out for all 
 its foreign mail contracts. And yet Mr. Dingley, who 
 ought not to be ignorant of this, repeats his stale argument 
 at the close of the following paragraph : 
 
 " Among the methods adopted by England with this 
 object (the promotion of the shipbuilding) are the tendering 
 of liberal contracts for the construction of war ships and 
 transports to encourage the establishment and extension of 
 shipyards, direct subsidies to shipbuilders who would con- 
 
8 SHIPPING SUBSIDIES AND BOUNTIES. 
 
 Struct iron steamships after plans prepared by the Admiralty, 
 and enormous indirect subsidies for carrying the mails, to 
 encourage the establishment and maintenance of British 
 steamship lines." 
 
 There is no " liberality " in British contracts for war ships. 
 The British government, like our own in this respect, acts in 
 a business-like manner. It gives its contracts to the lowest 
 bidder of the requisite qualifications. Mr. Dingley founds 
 this broad assertion on some special contracts made by the 
 British Admiralty in its own interest, which, so far from prov- 
 ing that the government protects the shipyards, proves the 
 exact opposite, namely, that the unprotected shipyards aid 
 the government. The British Admiralty looks after its own 
 business, as our Secretary of the Navy and his advisers look 
 after theirs, and they would have done well to have imitated the 
 English officials in this respect. If Congress had authorized 
 private American steamship companies to build such ships as- 
 the Boston, Chicago, and other " fast cruisers," and had paid 
 them sufficient to compensate them for the extra cost in 
 constructing and running them, it would have been more 
 economical for the government than to commission them 
 outright as men-of-war. But with the present prices 
 demanded by our shipbuilders it could not have rriade as 
 good a bargain as has been made by the British Admiralty. 
 Nobody would expect ships thus heavily built and fitted to 
 be constructed as cheaply as ordinary merchant steamers, or 
 to carry as much cargo by at least twenty per cent. The in- 
 ducements are not too much, and the Admiralty is finding-it 
 out, for since it has lately reduced its offers, few companies 
 care to accept them. Moreover, there is no condition made 
 that these vessels shall be built in British shipyards. The 
 bargain is made with the steamship companies, and if the 
 Messrs. Cramp of Philadelphia will build the ships for them 
 cheaper than they can be built upon the Clyde, they will be 
 equally entitled to the advantage. But what an infinitesimal 
 
SHIPPING SUBSIDIES AND BOUNTIES. 9 
 
 part of the British commercial marine these few quasi men- 
 of-war are ! How small a part of its steam fleet plying even 
 between England and America ! How small a part even of 
 the regular lines that ply between England and the one port 
 of New York, without any bounty, subsidy, or government 
 emolument whatever ! The Anchor, the Guion, the Monarch, 
 the National, the Wilson, the Sumner, the Beaver, the 
 Bristol, the State, the Arrow, and other regular direct lines 
 between New York and England, besides the " triangular" 
 lines and almost innumerable independent steamships, some 
 owned by companies and some by private individuals, — 
 where are their subsidies, bounties, mail contracts, or even 
 letter postages ? 
 
 It has been made evident that the English practice extolled 
 by Mr. Dingley does not exist. It has been made evident 
 that the British Admiralty looks only after the interests of 
 the navy, the Post-ofHce Department takes care of the mails 
 and the British shipbuilding and carrying trades take care of 
 themselves. It would have been difficult for Mr. Dingley 
 to construct a paragraph more misleading in every respect. 
 The private shipyards on the Clyde were already firmly 
 established. They had turned out hundreds of thousands 
 of tons of steamships before the government had given 
 them a single order, and the great majority, some of them 
 the most prosperous of all, have not made a contract with 
 the government to this day, although it has always been in 
 their power to do so, as there was an open market for their 
 bids. "Fostering" is an American word. The English 
 have no use for it. It is a synonym for protection, and 
 protection is a synonym for robbery. It is taking the 
 money of other people to confer its benefit upon one. It is 
 an injury to the recipient as well as to the contributors. It 
 destroys a man's energy by quenching his spirit of self- 
 reliance. Upon the instant that protection was taken away 
 from the British shipbuilders, they aroused themselves to 
 
lO SHIPPING SUBSIDIES AND BOUNTIES. 
 
 action, and now they stand foremost in the world. The 
 American shipbuilders still crouch under its wings, and not 
 satisfied with their entire monopoly of the coasting trade, 
 whereby they are enabled to charge their countrymen thirty 
 per cent, more than they ought to pay for ships, they come 
 to Washington every year begging for a bounty or a sub- 
 sidy, when it is owing solely to their influence there that our 
 merchant marine has come to destruction ! 
 
 It is painful to follow Mr. Dingley in his tortuous wind- 
 ings of argument. He says : " The French government 
 offers a bounty of thirty cents per registered ton for every 
 thousand miles sailed by a French vessel actually engaged 
 in the foreign trade. The bill approved by the- American 
 Shipping League and introduced at the Forty-ninth Con- 
 gress by General Negley of Pennsylvania, is substantially 
 the same as the French law." This is a part of the truth, 
 but not the whole truth. If he had told the whole truth he 
 would have demonstrated my argument that commerce and 
 shipowning are regarded by France also, as of greater import- 
 ance than shipbuilding. The bounty of thirty cents per ton 
 applies to all vessels under the French flag if the vessel is built 
 in France, and a ship is entitled to one half of that amount 
 if she is built abroad, so that it is often cheaper for French- 
 men to build their ships in England and obtain half the 
 bounty than to get the whole of it by building them at 
 home. This shows that the acquisition of ships and not the 
 protection of domestic shipbuilding is the main object of the 
 French law. 
 
 In further apology for soliciting public charity for ship- 
 builders, Mr. Dingley continues : " The increased cost of 
 running an American steamship, mainly in consequence of 
 higher wages paid the large number of officers and men, is 
 a constant burden which renders competition with British 
 steamships difficult, and which the ' free ships ' remedy does 
 not reach." Does Mr. Dingley need to be informed that 
 
SHIPPING SUBSIDIES AND BOUNTIES. 11 
 
 the Inman and Red Star steamships are American in every- 
 thing but the flag? They are officered and manned indis- 
 criminately, as much as our coasting vessels are, by Ameri- 
 cans and foreigners, while they are owned almost entirely 
 by our own countrymen. Will he seriously maintain that 
 the mere hoisting of the English or Belgian bunting at their 
 peaks can make the difference of a single penny in the cost 
 of sailing them ? The wages paid on the Atlantic fleet of 
 steamships to their seamen (;£'4 per month) are as high as 
 those paid in our coasting trade, and yet to establish his 
 point Mr. Dingley quotes the report of an American consul, 
 that crews receive thirty-eight per cent, higher wages, and 
 demand twenty-seven per cent, better fare on American than 
 on British ships. I apprehend that if this backwoods official 
 could dine in the forecastle of a British ocean steamship he 
 would find that his singular estimate of twenty-seven per 
 cent, might apply more nearly to the superiority of his food 
 over that to which he has been accustomed at home. Does 
 not Mr. Dingley know that many iron sailing vessels and 
 steamships besides those just mentioned, officered and 
 manned by Americans as much as any of our coasting ves- 
 sels, are sailed under the British flag, because their own flag 
 is denied them, and may it not strike him as an unpleasant 
 consequence of this practice, forced upon our countrymen 
 by prohibition, that some of them are under contract in case 
 of war to put their ships at the disposition of the British 
 government, even if it should happen to be a war with the 
 United States? It would indeed be a singular spectacle, 
 for which he and his adherents would be responsible, to 
 behold the guns of these American fast cruisers turned 
 against our own countrymen. 
 
 Mr. Dingley continues : " It is far more difficult now to 
 devise a policy to enable our shipping in the foreign trade 
 to compete successfully with the British and other foreign 
 vessels than it would have been thirty-four years ago, when 
 
12 SHIPPING SUBSIDIES AND BOUNTIES. 
 
 the revolution from wood to iron and from sails to steam 
 first began to place our vessels at disadvantage." Here at 
 least is a candid confession, and it is better to mend late 
 than never. In these thirty-four years we have paid more 
 than $4,000,000,000 freight money to foreigners, a great part 
 of which might have been appropriated by our own citizens 
 but for the opposition of Maine and Delaware shipbuilders. 
 It is, indeed, more difficult to succeed now than it would 
 have been thirty-four years ago, because our neglect to 
 adopt a true policy has given our rivals the superiority of 
 experience in a calling which our government has forced us 
 to abandon. So it is proposed to hire men to gain a new 
 experience in ships needlessly expensive. It is admitted by 
 his own figures that so long as the cost of ships was about 
 the same in England and in the United States, we were at 
 no disadvantage whatever. On the contrary, we were con- 
 stantly gaining, notwithstanding that the relative difference 
 in the cost of sailing vessels was no more nor no less than it 
 is now. When the revolution in shipbuilding took place 
 there was not a single nation on the globe, excepting the 
 Chinese and our own, that was precluded from availing itself 
 of the opportunity to profit by it. Even China soon saw 
 the folly of a policy of restriction. The importance of the 
 occasion justified her in abrogating a law that had existed 
 from time immemorial, while we adhered to ours that had 
 been enacted in the last century, and had hitherto been pro- 
 ductive neither of harm nor of good, but which at last be- 
 came a dead weight on our future progress. The results 
 are before us. The foreign carrying trade of every nation, 
 excepting our own, has greatly increased during the last 
 thirty-four years. Ours has been extinguished. Theories 
 may fail, figures even may lie, but facts cannot be con- 
 tradicted. 
 
 Mr. Dingley is partly right and partly wrong in saying 
 that a protective tariff is not the cause of the decadence. 
 
SHIPPING SUBSIDIES AND BOUNTIES. 1 3 
 
 It is not the whole cause, although it cannot be denied that 
 in the industry of shipbuilding, protection has stood in the 
 way, and Mr. Dingley, it is scarcely necessary to repeat, of 
 course considers this the point at issue all the time. All 
 other nations, among whom all sorts of tariffs, high or low, 
 for protection or for revenue, prevail, have in these thirty- 
 four years been increasing their carrying trade, irrespective 
 of the policy that has guided them in their domestic affairs, 
 simply because they have had the wisdom to acknowledge 
 that' the ocean is the common property of the world, over 
 which their internal laws had no control, and they have had 
 the ordinary intelligence to see that the cheapest and best 
 ships upon it command its business. Therefore, if they cannot 
 build such ships, they buy them. Many of these nations, 
 having first become shipowners, are now their own ship- 
 builders. Germany is a notable instance of this. Although 
 still having the liberty to purchase, she builds nearly all her 
 own ships. The introduction of foreign-built ships necessi- 
 tated repair shops, and these soon developed into shipyards, 
 precisely as the introduction of railroad engines into the 
 United States led to the building of our own engines, which 
 we have for years not only built for ourselves, but have ex- 
 ported. Give the American shipbuilders the same incentive 
 of competition that the American engine builders had, and 
 they, too, will do as well. The engine builders have been 
 treated with a stimulant ; the shipbuilders have had a pro- 
 tective sedative administered to them. Each medicine 
 shows its natural effect. 
 
 Mr. Dingley proposes this question, and proceeds to an- 
 swer it himself, although he does not state it fairly : " If we 
 should adopt the policy of relying upon the Clyde and the 
 Tyne to build our vessels, what would be our situation 
 if Great Britain should become involved in a war with some 
 great naval power ? " In the first place, he knows very well 
 that no advocate of free ships has ever made any such propo- 
 
14 SHIPPING SUBSIDIES AND BOUNTIES. 
 
 sition. Some injudicious friends of the measure have sug- 
 gested the purchase of foreign ships, to be engaged ofily in 
 the foreign trade. A moment's reflection will expose the 
 futility of such a method. No American would avail him- 
 self of it, because we already have all the advantages it 
 would confer by owning our vessels, as the Inman and Red 
 Star lines own theirs. What we desire is to own ships that 
 are to all intents and purposes American, and that can be 
 used anywhere and everywhere. At the same time we 
 intend to interfere as little as possible with the monopoly 
 now existing of building ships for the coasting trade, and 
 virtually existing for that purpose alone. When the ques- 
 tion was first agitated in Congress, twenty-eight years ago, 
 this was our simple bill which we have steadfastly adhered 
 to ever since : " Be it enacted that ships of not less than 
 3,000 tons, wherever built, may be enrolled under the Ameri- 
 can flag, enjoying all the privileges it confers, and that all 
 the materials to be used in shipbuilding of any kind shall be 
 admitted duty free." Had such a bill been passed at that 
 time, we should to-day divide the carrying trade of the world 
 with Great Britain, and we should not be under the necessity 
 of ordering from the Clyde ships of any size whatever. 
 
 Mr. Dingley says truly : " The tonnage of our shipping 
 in the domestic trade has increased from a sail equipment of 
 1,639,314 tons in 1869 to 6,177,475 tons on the 30th of June, 
 1888. This gives the United States a home fleet which has 
 increased more rapidly than the similar fleet of any other na- 
 tion, and with a tonnage more than three times that of the 
 United Kingdom, and five times that of any other nation." 
 Can it be imagined that a shipbuilding industry like that 
 which has supplied this immense increase of coastwise ton- 
 nage, and which would still not be practically interfered 
 with by the scheme proposed, would not be able to keep up 
 the supply for ocean purposes in case our trade with Eng- 
 land should be cut off ? On the other hand, as we now are, 
 
SHIPPING SUBSIDIES AND BOUNTIES. 15 
 
 " in case Great Britain should become involved in a war with 
 some great naval power," what then ? Why, her great mer- 
 cantile fleet would be in the market at almost any price. 
 Any Swede, Portuguese, or Italian could buy her ships and 
 take her carrying trade, while we who furnish its commerce 
 would be obliged tamely to look on and see them growing 
 rich through our stupidity. 
 
 Already other European nations, haying learned to build 
 ships by buying them from England, are threatening her 
 maritime supremacy. The inertness of our Congress, and 
 its subservience to the influence of our shipbuilders in not 
 permitting us to buy English ships, is indeed astounding to 
 them, and it is not surprising to read in the St. James Gazette 
 a criticism upon what that journal considers the impolitic 
 liberty which England has given to her shipbuilders, to sell 
 ships to any people outside of the United Kingdom. It is 
 an evidence that British statesmen look upon free ships for 
 Americans with the same fear with which they regard our 
 advance toward free trade. Free ships will interfere with 
 their carrying trade, and free trade will interfere with their 
 commerce. Thus reasons this influential London journal: 
 
 " Our commercial marine is exposed to formidable compe- 
 tition on the part of Germany, France, and Belgium, and 
 the statistics of Hamburg, Antwerp, and Havre show a 
 greater advance in trade than Liverpool and London have 
 made during the last twenty years. The time is not far 
 distant when the United States will join in the ocean race, 
 as the agitation for a repeal of the laws which forbid A meri- 
 can citizens to buy English ships, is becoming more strenuous 
 every year at Washington." 
 
 What is that but an admission that Englishmen regard the 
 only method by which we can compete with them upon the 
 ocean, with distrust ? If some of our Anglophobist poli- 
 ticians can grasp that idea, it may have an effect upon their 
 tarifl and free-trade legislation. 
 
l6 SHIPPING SUBSIDIES AND BOUNTIES. 
 
 This is not the first time that there has been an organized 
 effort made to raid upon the public purse by subsidy and 
 bounty seekers. Subsidy has reared its head in every ses- 
 sion of Congress for nearly thirty years, and every time 
 it has been struck with a brick. It now counts upon success, 
 because it has contrived the advent of the Pan-American 
 Conference, and we are grateful to it that it will thereby 
 afford a demonstration that, under our present tariff, trade 
 with South America is impossible. 
 
 The " Pan-American Conference," by the by, is a mis- 
 nomer, as any student of Greek and geography will testify, 
 inasmuch as it cannot be " all American " without including 
 Canada. Mr. H. K. Thurber, the president and principal 
 owner of the " United States and Brazil Mail Steamship Com- 
 pany," is credited with the original conception and successful 
 effort of bringing the South American members of this body 
 to our shores. Concisely stated, the object of the scheme 
 IS a subsidy for his steamship line. Mr. Thurber is a rich 
 man. Millions of dollars stand to his credit in account. But 
 he is not content. His steamship enterprise is not so profit- 
 able as his grocery business has been. He knows as well as 
 anybody knows, the reason. His ships, protected by the 
 monopoly enjoyed by American shipbuilders, which prevents 
 him from buying cheaper and better vessels elsewhere, cost 
 him 30 per cent, too much. The outward freight of mer- 
 chandise they might carry is handicapped by an average 
 tariff extortion of 47 per cent. He desires to extend his 
 voyages to the Argentine Republic, and his homeward 
 freight of wool would be burdened by a duty running from 
 60 to 90 per cent, ad valorem, according to the amount of 
 dirt and grease on which this duty is levied equally with the 
 wool. 
 
 It does not occur to the patriotic Mr. Thurber to ask our 
 government to repeal the restrictive navigation laws so that 
 he can own ships on the same terms with his rivals, nor to 
 
SHIPPING SUBSIDIES AND BOUNTIES. 1 7 
 
 ask for the removal of the duties on iron, lumber, and chem- 
 icals, so that he can ship goods at no greater cost than theirs, 
 nor to demand free wool, so that it may be brought to our 
 ports as readily as to those of England. He is willing that 
 all these burdens on his fellow-countrymen should still be 
 borne by them, and he desires to add to them by taxing them 
 to contribute money for a subsidy so that he may endeavor to 
 neutralize the difficulties that stand in his way. Mr. Thurber 
 knows well enough, for it has been repeatedly demonstrated, 
 that even if his line should be subsidized to the extent of 
 enabling him to carry goods both out and home absolutely 
 gratis, he could not compete with Englishmen, who, not 
 being hampered in any of these directions as we are, could 
 still carry on their business as successfully as they now do, 
 continuing to pay their customary charges of freight. But 
 independent of the merchandise mentioned there are certain 
 articles of our production which can be profitably exported 
 without subsidy, such as flour, petroleum, and agricultural 
 implements, and he can bring back coffee from Brazil, and 
 hides from Buenos Ayres, because these articles are not 
 dutiable. Still, as there is not enough of this legiti- 
 mate business to make his line as profitable as he could 
 wish, he wants a subsidy of one or two or three hundred 
 thousand dollars per annum, the more the better, to supple- 
 ment it. 
 
 The effrontery of his demand is more conspicuous when 
 it is considered that the title of this steamship line is also a 
 misnomer. It is, in fact, a slow Brazilian coasting line, 
 subsidized by the Brazilian Government to run between 
 the ports of Rio de Janeiro, Bahia, Pernambuco, Maranham, 
 and Para, before it leaves for the United States, touching 
 on its way at Martinique and St. Thomas ; so that the most 
 speedy and direct correspondence between New York and 
 the southern provinces of Brazil, and the Argentine Re- 
 public, is by way of England. 
 
l8 SHIPPING SUBSIDIES AND BOUNTIES. 
 
 It is safe to predict that the subsidy scheme will not suc- 
 ceed now any better than it has done heretofore. Bounty 
 has not been so impudent and so persevering as subsidy. 
 It has never openly shown its face but once before, and that 
 was nineteen years ago, when it was championed by another 
 Maine Representative anxious to be re-elected from his 
 " deestrik." Congress was so ignorant at that time that in 
 its appointment of the Lynch committee to investigate the 
 decadence of the carrying trade, they called it the decadence 
 of commerce, and Mr. Lynch and his associates concluded, 
 like Mr. Dingley, that both terms signified shipbuilding. 
 They brought in a voluminous report to prove that the 
 Alabama destroyed shipbuilding by furnishing shipbuilders 
 with employment of which they would have had all the 
 more had new wooden ships been needed to replace those 
 that had been burned. When Mr. Lynch's report came be- 
 fore the Senate and it was proposed to lay it on the table. 
 Senator Davis moved an amendment that it be kicked be- 
 neath it. 
 
 Mr. Dingley is somewhat in advance of his illustrious 
 predecessor. He recognizes the fact that in a great degree 
 steel has superseded wood, and steam has superseded sails. 
 He knows, as we all know, that wooden sailing ships will 
 soon become things of the past, and yet he proposes to 
 effect restoration by including the old hulks of his con- 
 stituents in his bounty bill ; they are to run all over the 
 world with lumber, coal, petroleum, or in ballast, and they 
 are to get their 30 cents per ton for every thousand miles 
 they can log! If the membership of the " Shipping and In- 
 dustrial League " is examined, it will be found that the most 
 prominent men in the concern are owners of wooden sailing 
 ships. In a moment of confidence, which I will not violate 
 by revealing his name, one of them told me frankly that his 
 object was to create a market for his old ships and to get 
 rid of them. 
 
SHIPPING SUBSIDIES AND BOUNTIES. I9 
 
 Now, what would be the effect of this bounty on iron 
 shipbuilding? Whereas the free importation of ships 
 would force our iron shipbuilders to produce others as 
 good and as cheap as those we should obtain from abroad, 
 this gift would be a premium on their disposition to 
 stand still in the march of progress. Worst of all, to my 
 mind, would be the humiliating confession it implies — that 
 the American sailor has lost his energy, his pluck, his man- 
 hood; It has been his pride that he has English blood run- 
 ning in his veins. It is in his memory that, in times past, 
 when ships were owned on equal terms, as they might be 
 again, he competed with Englishmen on the seas, asking for 
 no favors, as Englishmen ask for none, as Germans, men of 
 the same stock, ask for none. And now — I mean no disre- 
 spect to a people whom I admire for their military prowess, 
 their fine arts, among which culinary skill is not the least, 
 their literature, their social amenities and general intelli- 
 gence, — and now Mr. Dingley tells us that because France is 
 hiring her people who are so pre-eminent on their natural 
 element the land, to become what God never intended them 
 to be on the sea, the American sailor is to be treated like- 
 wise as an object of national charity ! Let the government, 
 if it pleases, still enable the protected manufacturer to dwell 
 in luxury and ease at the expense of the toiling millions 
 until, like the men of Ohio and Iowa, they throw off the 
 yoke, but let it permit the American sailor to remain a man. 
 He wants no subsidy, no bounty; all that he asks is the 
 liberty to protect himself. 
 
 THE END 
 
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