New-York tribune., 1917-07-24
First Effect of New Agree
ment Will Be Big Cut
in Ocean Rates
Neutral Vessels
Forced Into Service
America and Great Britain,
by Ownership of Coal,
Hold Key to Situation

sion downward Of ocean freight rates
has been agreed upon in principle by
shipping commissioners designated by
President Wilson and the British For
eign Office to represent the govern
ment Of the United States and Great
Britain.
Copies of a proposed agreement, un-
der which the two governments not
only would make sweeping reductions
in present prohibitive rates, but Writ
ually would take over the operation Of
all Allied merchantmen in the Allan
tic, have been placed before the State
Department and the British Foreign
Office for approval.
All the Allies, with the possible ex-
eeption of Japan, have signifed thoir
willingness to accept the programme.
In the case of japan it is proposed to
have a Japanese merchant feet of as
many ships as possible placed in the
transatlantic trade to help render in
effective the submarine warfare. This
and other phases of the proposed agree
ment will be considered when the Jap
anese mission. headed by Vice-Admiral
Takashita, reaches the United States.
To Control Neutral Ships
Neutral shipping, under the proposed
agreement. also would be forced largely
into channels designated by America
and Great Britain. This would be made
possible bv the enforcement of regula-
tions denying to neutral ships supplies
of bunker coal, needed by Allied mef-
chantmen, unless the neutral ships
agreed to make at least portion OF
their sailings between American and
Allied ports.
With the programme in effect, the
United States and Great Britain Writ
ually would control the entire worlds
shipping, prescribing reasonable rates,
far lower than those on some corrlmodi-
ties now in effect, and designating sail
ings and voyages.
Thus the entire aspect OF the WORLDS
ocean transportation system would be
changed largely to meet the new con-
ditions caused BY the submarine war.
The proposal was entered into to assure
the Allies, as far as possible, that ships
would be Forthcoming. and that trans
portation charges would be reasonable
for carrying supplies from this coun-
try to Europe during the continuance
of the war.
Negotiations were begun at the in
stance of President Wilson, whose
views concerning the unreasonableness
Of present ocean freight rates were
outlined in his appeal July IL TO the
business interests of the country TO put
aside selfish considerations. Prior to
yoicing that appeal the President had
designated Chairman Denman of the
Shipping Board and Counsellor Polk
of the State Department to represent
the United States in the conferences
with British officials. Thomas Royden,
chairman of the Allies Charterlng
Commission, and j. A. Salter, requlsi-
tioning director here Of the British Ad-
miralty. represent Great Britain.
France and Italy Agree
France and Italy have been advised
of the negotiations and have indicated
their adhesion TO any programme which
might be evolved.
The agreement placed before the
State Department and the British For
eign Office by the four commissioners
is not the first one to have been drafted
by officials of this country and Great
Britain. About two months ago Lord
Eustace Percy, of the British mission.
and DR.. Z. Z. Pratt, then chief Of the
Bureau of Foreign and Domestic Com
merce, reached a verbal agreement un-
der which the United States would have
cooperated with Great Britain in regu-
lating the rates and movements OF
ocean going craft of all the Allies.
This agreement, afterward reduced TO
writing, was disapproved by the State
Department for reasons which have
never been made public. Negotiations
between the four shipping commission
ers followed.
In surveying the situation the COM
missioners found that some of the
Allies, notably Italy, had vessels for
which there was an urgent need IN
transatlantic trade lying idle at home
wharves because there was no system
by which owners might have been com
pensated for their destruction. Italy
was reported at that time to have sp-
nroxinately 10000 tons of oceangoing
sbipping thus rendered ineffective.
In neutral countries similar situa-
tion obtained in many respects. In the
case of Japan, II was found that
Jananese vessels were making large
yTofts in Pacific trade, which was not
reoarded as essential as transatlantic
trade. Many thousand tons Of shipping
are reported to have been building IN
Jananese Yards. with steel and other
materials imported from the United
States. Recently the Exports Council
has virtually placed an embargo on All
steel and steel products for shipouild-
ing 10 Japan. c p.;.
ain control the master keys to the