Evening star. [volume] (Washington, D.C.) 1854-1972, 1905-09-09
It's Methods Of Doing Business
Criticised
BY TWO CONTRACTORS
WHAT OFFICIALS HERE HAVE TO
SAY.
The Feeding and Houdng Of Employees
Ii Not Contract, but
Concession.

One of the first results OF the announced
determination OF Chairman Shonts OF the
isthmian canal commission to build the
Panama canal on business principles. has
been the fling with the President Of bit
ter protest by disappointed bidders in New
York against the allotment by the commits
sion Of q concession for the housing and
feeding Of the army Of employees who must
actually construct this vast work. These
protests were filed by H. Balfe & Co.. who
at present hold the contract for feeding in
coming immigrants at Ellis Island, N T.,
and Hudgins & Dumas, who originally held
the same contract when the government
undertook to see that these immigrants
were properly cared for when they arrived
in America. They assert that Mr.. Shonts
awarded the contract to erect hotels and
commissary camps on the isthmus to ]. e.
Markell Of Omaha. Neb, in a collusive man.
ner. allowing that bidder to take advantage
OF their own bid. regardless of the fact that
he was not the lowest bidder. Mr.. Shonts
will not be in Washington for two weeks
but he has made answer in his own way to
these charges from his summer home at
Greenwich. Conn.
Commissions Method Of Business.
Naturally the officials here do not care
to talk for publication about a matter that
concerns their superior officer. but the facts
as to the commissions methods OF doing
business with contractors are freely dis
cussed. In the first place. 1t appears that
the ordinary rules and statutes relating to
the award of government contracts do not
necessarily bind the commission In all of its
operations connected with the canal. So far
as the allotment of contracts for large I'M
dertakings connected with the canal are
concerned, and certainly for all expendi-
lures above $4,000. by the Presidents order.
due advertisement Is had and the contract
awarded to the lowest responsible bidders.
But the situation is different as to the
Panama railroad, which, though under &C
tual government ownership. Is operated I'M
der an Independent charter, and as Mr..
Shonts points out. this hotel and commits
sary award was made by the Panama Rail-
road Company. That company has ever
since its construction fifty years ago oper-
ated one or more hotels principally intended
to accommodate its own employees, though
transient guests were also taken. So 1t is
pointed out that what Mr.. Shontz has done
Is simply to extend the existing system.
Not Contract at All.
But another point made at the commission
Is that this arrangement, after aIl is not
contract in Its true sense. but rather a con-
cession. The United States government IS
not involved in cent Of expenditure. Its
male employees are to pay for their own
keep, and all that the commission has done
Is to adopt proper precautions to make sure
that they get good food and shelter at rea-
sonable prices and are not the victims Of
extortion. So there Ia no ground for the
assumption that in the making of this ar
rangement with Mr.. Markell the commission
has involved the government in any expen-
diturs.
Mr.. Markets history Ia well known to the
railroad men who have been drafted into
the service of the commission as experts.
They say that he has for years made 1t q
business to feed thousands of railroad con-
struction gangs, and only recently, and up
to the outbreak of yellow fever at New Or
leans had been caring for an army Of la
borers engaged near there in the rebuilding
Of the Illinois Central railroads vast ter
minal works. which were destroyed by fire,
force almost half as large as the total
number of employees who will probably
work on the canal