New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1912-09-06
CANAL NEGOTIATIONS
MAY Be FINANCIAL
Washington Officials Draw This
Conclusion from Sir Edward
Grey'S Letter.
JOHNSON HAS DATA READY
Expected to Show Exemption OF
American Traffic Will Have
No Influence on Brit
ish Shipping.

ish Shipping
Washington Sept 5-The letter OF
Sir Edward Grey. the British Foreign
Secretary. TO the Gateshead Chamber
OF Commerce yesterday regarding the
British governments attitude toward
the Panama Canal act is regarded here
as an indication that the negotiations
between the two countries are to have
a financial basis. the Foreign Secre-
tary's argument being that British
shipping is TO be burdened with an un-
due proportion Of the charges for the
maintenance OF the canal through the
complete exemption from tolls OF
American coastwise shipping.
In view Of this. Importance attaches
10 an inquiry which now is being con-
Quoted on the isthmus by Professor
Emery r Johnson, special commits
sioner on Panama traffic and tolls.
Professor johnson already has com
piled. ny direction OF the Secretary Of
War, all OF the vast amount " statis-
tics bearing or the character and prob
able amount OF the traffic that viii
pass through the canal, which has
formed the basis of action by Congress.
He now Is engaged IN a study Of the
financial aspect of the enterprise, so
that the tolls may be adjusted 10 the
needs OF the canal on a strictly scien-
- rr tod 2 = n
ington soon with these data.
In view Of Sir Edward Grey's state
naent that British ships viii have 20
nav for the American exemption. 10 Is
noted that In the data already pre-
pared by Professor johnson II appears
that according 10 the best estimate the
whole Of the American coastwise traffic
which is likely 10 pass through the
Panama Canal Immediately after IL is
opened viii be about one million tons.
or a little more than 10 per cent Of the
total tonnage which will pass through
the canal In the years 1915 ana 1915.
In the course Of FIVE years il rs esti-
mated that this American coastwise
tonnage will rise 10 1.4l4.p0o tons. but
as the foreign commerce VIII increase
in like proportion. the same relation
between the two will exist.
on the face Of the figures this would
indicate that the British and other for
eign commerce would have 10 bear an
additional burden Of 10 per cent in
tolls over and above what Il would pay
were American coastwise shipping not
exempted. II Is pointed out, however.
as a matter at fact, that q proportion
ate share OF this burden. II II did eX-
ist would have 10 be borne b. Ameri-
can ships in the foreign trade. which.
consequently. would be on q precise
equality with British ships.
Low Tolls Advocated
Professor Johnson's statistics dis
close still another factor that doubt
less will be urged by the American
negotiators. as q reply 10 the British
contention that their ships must bear
the burden Of this extra charge caused
by the American exemption. This is
set out in his comparison OF the Suez
Canal with the Panama route. After
pointing out the many advantages Of
the Suez in the way OF cOaling facili-
ties, low insurance rates. superior OPP
portunities for picking up cargoes be-
tween terminals. and the like, Profess
sor johnson declares that the only pos
sibilitv OF the Panama Canal getting a
fair share Of the worlds business is 10
place the tolls at a figure actually
lower than by the Suez route. These
are now 81 - a ton. so that the rate on
the American canal must be sensibiy
lower than this, and the professor has
even mentioned a fat dollar rate for
the first few years Of the canals OPP
Grafton at least
on the basis of ten million tons busi-
ness this would yield an income in
adequate 20 meet the cost Of opera
ton and maintenance Of the canal
$500. 600. allow $4,000 a year for
sanitation Of the zone and provide q
fair rate 81 interest on the 1876. 000. 900
which the canal has cost not 10 speak
% the impossibility OF providing for q
sinking fund Allowing per cent in
terest on the capital invested in the
canal and ] per cent for Il sinking
fund the total Of the annual charges
on the canal is likely 70 be more than
$4,000 600, or about 30 per cent more
than the gross revenue from tolls.
With these figures before them and
the rate on British shipping fixed far
below the actual cost OF the service by
conditions over which the United States
government has no control. IL - be-
heved by the officials here that they
will have little difficulty in showing
that the exemption Of American coast
wise traffic from tolls has no influence
upon British shipping, and consequent
is that no discrim inatiou is proposed
In violation Of treaty rights.
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