The morning call., 1893-03-01

coasts, and especially for the steamship
companies" replied Houston. Now the
Panama railroad must be paid large rate
for short haul, and that lessons the
profit"
Houston said that the Pacific Mall COM
pany received subsidy of $1,000 trip from
New York to Aspinw wall, and of S2500 for
the west coast trip.
do you think yourself justified in ac-
cepting tie money, which was paid for the
development of commerce." asked Mr..
Geary, while you are in transcontinental
combinatlon?"
IL don't think it has anything to do NTH
it," Houston answered. THE Increased
service entaied on us has been so onerous
that l would be perfectly willing II the
POstmaster-General would cancel our bond
and give up the contract. Yes, do think
that the act tended to in crease trade, but it
has been at our expense. There has been a
very decided increase in tr ade between San
Francisco and the Central and South Ameri-
can coasts as a result of the contract. For
instance, the German line formerly carried
$1,000 bags of coffee per year. Last year it
carried only SO, coo bags, and the Increase
came 10 the Pacific Mail Company, which
secured the business"
In answer to further questions Houston
said that the Transcontine Association
probably made its arrangements with the
Pacific Mail Company partly for the pur-
pose OF preventing competition.
Edward Lauterbach. director and the
attorney for the Pacific Mail Steamship
Company, told of the efforts made since the
break between the Panama Railroad CON-
pany and the Pacific Nail Company TO have
friendly relations continued. II invoked
aid of Mr.. Grace" he said, land there was
where put my foot in it,"
He then went over the fact that Grace
was interested in what was commonly
known as the Chilean Steamship Company,
and that company sought to secure the
trade from Panama north to Acapulco,
which the Pacific Mail Company had paid
for and was just bringing into promising
activity under the reciprocity treaties. That
attempt was checked by the New York
courts granting an injunction. The Panama
Railroad had passed under French control,
and it was a question for consideration
whether such railroad at an important
strategic point should be allowed to con-
tinue foreign corporation. The arrange
ment between the Panama Railroad Com
pany, the Transcontinental Association and
the Pacific Mail was, he thought beneficial
TO the people of California. There had for
merly been a war between the steamship
company and the railroads. In which the
merchants of California had agreed 10
stand by the water carriers. The railroads
gave rebates to the merchants and all but two
firms deserted the steamship company. The
Pacific Mail did not get much business, the
railroads lost money, and, on the whole, the
merchants did lot fare well, for rates were
unstable and uncertain.
Drake, a member of the executive board
of the Panama Railway Company. said that
shippers had been led to believe that the
service by the isthmus was q forty days
service, whereas it should be twenty five TO
thirty days service, against fifteen or
eighteen by the railroads. The object of
the payment of a subsidy TO the Pacific
Mail by the TranscOntinental Association
was to eliminate ths Pacific Mail as a
factor In the transportation business. Hav-
ing accomplished this the subsidy was
Withdrawn. This closed the hearing.