Honolulu star-bulletin. [volume] (Honolulu [Oahu, Hawaii]) 1912-2010, 1917-12-31
SHIPPING BOARD DOESNOTI intend
TOOVERTURN COASTWISE POLICIES

bonuses. Ne cost OF bunker fuel ana
supplies has advanced. The hazard.
Gus nature OF the enterprise perhaps
;ustifies somewhat higher returns
than usual on the capital invested.
The cost Of war risk insurance on the
ship IL included In the freight rate.
Yet all these factors DO not justify
the progressive multiplication OF
charter rates. nor the hitherto incon.
ceivable heights TO which freight
charges have advanced.
The market value Of q ship bears
q close relation TO its earning power,
hence the price Of ships, also, has
steadily mounted, until ships which
before the war would have sold at
from $50 to $50, have recently changed
hands at $500 or over. per d. ". ton.
After . careful investigation OF costs
and values, and after full conference
with representative shipowners. the
hoard determined that the inflated war
rates, arising as they did from abnor-
nal conditions due to the submarine.
and 10 the diversion OF tonnage for
military purposes, did not represent
fair and legitimate values Of the kind
that are conclusive in determining
just compensation. The board there
fore fixed a tentative scale Of reeui-
sition rates, SUBSTANTIALLY higher than
the prewar basis. which took full &C.
count Of increased costs and leEiti.
mate increases In ship values, but
which nevertheless was substantially
under the unjust market rates then
NRNUAIAAf ThA -
effective at once for all vessels requi.
sitioned by the board for military
service.
TO single out certain vessels and
to limit their earnings to reasonable
level. and 1t the same time to leave
others operating in free trades al
rates forced to even more fantastic
heights by the requisitionins Of com
peting tonnage, would have produced
a manifest discrimination. Moreover,
In q war In which the mobilization
OF economic resources 10 second In I'm.
portance only to the service Of armies
In the field, the distinction between
war service and commercial service
scarcely exists. Ali commercial ship.
ping connected with vital American Ia.
dustriet II engaged In war work.
The board has therefore recently
adopted . policy Of reouisitioning Tor
government account all power.driyen
steel cargo vessels OF $500 tons dead.
weight or over, and all passenger yes
sells OF $500 tons gross register or
ever, adapted TO ocean service. The
operation Of these vessels is entrust-
ed In large part to the companies by
whom they were formerly controlled,
but all receipts have been for goy.
eminent acc. unit, the owners being
credited with the reQuiiition rate
fixed by the beard The vessels.
moreover, are under fnll control of
the board 40 to voyages, carsoes, and
rates and as to safeguards for their
protection against the hazards Of war
sone service. II 10 hoped that this
policy ilf be the meant OF aehisving
two results which In the opinion Of
the board are necessary: First, com.
plete unity Of control over the dis.
tribution Of chipping, 30 that var
needs may be filled In the order OF
their emergency: and second, just and
effective regulation OF rates, 90 that
the nations 1t war with Germany may
not be financially exhausted By extor.
tomato transportation charges.
Further experience may develop
that, consistent with the PURPOSES
above outlined, some OF the steamers
not adapted to war service may prof.
itably be released from regulation. "A
to other lines, more effective methods
OF regulation and control may prove
to be necessary. II should be borne
In mind that Aside from the fsdul,
siticn poNsr the board ct present has
no Jurisdiction over rates In fcrAigB
trade and no jurisdiction over inter.
stats rates, except where VESSELS are
common carriers operating on regular
routes. II experiences shall prove II
to Be necessary, the board will recon-
mend drastic Legislation 10 meet more
effectively the situation arising from
the Acute dearth OF tonnage.
"Ths freight rates to be charstd
to shippers on requisitioned vessels
left In commercial service or assigned
to foreign governments have been
the subjeet OF careful consideration.
The board. OF course, has no desire %
profiteer at the expense OF any row.
efnment associated with the United
States In the war against Germany,
or Of the general public On the cther
hand existing contracts. particularly
those on Q {. |. I. basis, and special
market conditions often present q
danger that Q reduction In rate will
net inure to the benefit Of the con-
sumner but will merely transfer from
the ship0vners TO favored shippers
the monopoly earnings which 1t 10 In
tended to eliminate. The policy of
the board therefore will Be to charge
freight rates based on the redulsition
rate whenever II can receive assur.
ance that the benefit OF these low
rates win accrue to the American or
allied governments or 70 the consum.
ing public; and 10 charge HIGHER
rates whenever this fact shall not be
90 established The application Of
this policy will ne doubt present dif.
Hculties In Individual cases Dnt Il ID
believed in principle 70 BE- sound.
The reeuisiticn program - yet
has been In effect for such 4 short
period OF time that no accurate state
naeht Of receipts and expenditures can
row Be made. Accounts. however. are
being kept with serupulous care aIont