Arizona republican., 1912-09-06
An Indication of the Posi- tion Likely to Be Taken by the British in Negoti- ations in the Panama Controversy
THEY WOULD PAY
 MORE THAN SHARE
If Any American Ships Were Allowed to Pass Free; This Government Has Been Gathering Data Regarding Canal
ASSOCIATED PRESS DIspATcHl

WASHINGTON, Sept. 5.-A letter by Sir Edward Grey, British foreign secretary to the Gateshead chamber of commerce, yesterday, regarding the British attitude towards the Panama canal act is regarded here as an indication that the negotiations be- tween the two countries are to have 8 financial basis. the foreign argu- ment being that British shipping is to be burdened with an undue pro- portion of charges for the mainte- nance of the canal through the com- riete exemption from tolls of Amer iCan cOastwise shipping
 In view of this, importance at- taches to the inquiry now being con- ducted on the isthmus by Professor Emery B Johnson, special commits sioner on Panama traffic and tolls. Johnson already has compiled a vast amount of statistics bearing upon the character and probable amount of traffic that will pass through the canal He is now engaged in the study of financial aspect of the re- suit, so that tolls may be adjusted to the needs of the canal on a strictly scientific basis. He is ex- pectee soon in Washington with this data
 In view of Sir Edward Grey's states ment that British ships will have to pay for American exemption. it is said that in the data already prepared by Prof. Johnson it appears that accord- ing to the best estimate, the whole American coastwise traffic that will likely pass through the Panama canal immediately after it is opened, will be about one million tons or a little more that will pass through the canal in the years of 1915 and 1916.
 In the course of five years it is es- timated that this American coastwise tonnage will rise to 1,414,OOO tons but as foreign commerce will increase in
 
 tween the two will exist. On the face of figures. this will indicate that the British and other foreign commerce would have to bear an additional bur- den of ten per cent in the tolls over and above what they would pay were the American coastwise shipping not exempted.
 It is pointed out, however that proportionate share of this burden would have to be borne by American ships in foreign trade, which conse- quently would be on a precise equal ity with British ships.
 Prof Johnson's statistics disclose another factor that doubtless will be urged by the American ncgotiators. This is set out in his comparison of the Suez canal with the Panama route After pointing out the many advantag- es of the SueZ canal in the way of coal ing facilities, low insurance rates, su- perior opportunities for picking up cargoes between terminals, Professor Johnson declares that the only possi- bility of the Panama canal getting a fair share of the worlds business is to place the tools at a figure actually lower than by the Suez route. These are now SIPS a ron so that the rate on the American cara' must be sansibly lower than this. The professor has even mentioned a flat dollar rate for the first few years of the canals cp- eration.
 On a basis of ten million tons of business, this would yield an income adequate to meet the cost of the op- erations and maintenance Of the canal, s3,5OO. 900 and allow $500,000 year for | the sanitation of the zone and provide | a fair rate of interest on $375,000,OoO which the canal has cost, not to speak | of the possibility of providing for a l sinking fund Allowing two per cent | interest on the capital invested in the canal and one per cent for sinking i fund. the total of annual charges on the canal would likely be more than s15. 100000 or about fifty per cent more than the revenue from. the tolls. l With these figures before them, the rate on British shipping is fixed far below the actual cost of service by conditions over which the United | States government has no control. It is believed by officials here that they 1 will have little difficulty in showing that the exemption of American, coast l wise traffic from tolls has no influence upon British shipping and consequent | ly no discrimination is proposed in l 0f riphtC