Capital journal. (Salem, Or.) 1919-1980, 1920-02-18
REJECTS.
ALL SUBMITTED.
BIDS ON LINERS.
Shipping Board Heads Recon-
mends Offers for Former
German Liners be Turned
Down in Report

Down in Report
Washington, Feb. 1S.-Rejection of
all bids received for the thirty lur.ner
German passenger ships offered for
sale by the shipping board was recon-
mended to the senate commerce COM
mittee today by Chairman Payne of
the board who asked authority to re-
new negotiations for sale of the ves-
sells for operation under the American
flag.
The resolution was embodied in a
prepared statement which Mr. PAYNE
read to the committee. He recalled
that the board had sold 1888 ships In
accord with its policy to dispose of the
fleet to American citizens for opera
tion under the American flag and that
eighteen former German cargo vessels
were included in this number The
price received was s9S,545,947.
Companies Must Operate.
Chairman Payne said if the congress
desired to change this policy to public
ownership of ships the passenger liners
should not be sold and congress should
direct the board to pend the S75,OOO,-
600 estimated as necessary to convert
them from troop to passenger vessels.
1T should be understood" he said
'that the ships whether owned by the
government or by private capital must
in either case be operated by the ship
ing companies which are bidding for
the ships The government has no
adequate organization. for the direct
operation of ships.
IF the government continues to be
the owner, it must pay the operators a
fixed fec and a commission upon re-
ceipts and take whatever profit re-
mains, or if no profit remains must
bear all the losses"
. Prices Now High.
The chairman went on to say that in
accord with the join resolution OF con-
gress under which the ships were TAX
EN- over "a naval board had appraised
the craft, and that the prices at which
the board could sell now were sub
stantially in excess of the appraised d
value.
Mr., Payne said passenger ships were
scarce now and building prices high,
hut that these conditions might chanse
and the value of the ships be CORE
spondingly lessened.
IF we proceed to re-condition the
ships, making them fit for passenger
USE" continued the chairman, it will
take from six to twelve months to put
them into service. Our conviction Is
that we will not hereafter be able to
sell the ships for the cost Of re-condi-
tioning plus the price at which we can
now SELL"
Questioned as to the possibility o,
the vessels ultimately being sold TO
foreign interests, Chairman Payne told
the committe the ships could not be
transferred from under the American
flag without permission from the ship
ping board
Vessels sold to private operators for
service in lines designated by the
board could not finally and 'unalter-
ably be held in those lines without
congressional guarantee against loss
the chairman said
Asked about tse ownership Of the
International Mercantile Marine
Chairman Payne declared that investi.
cation by the board had shown the
companyt be 100 per cent American
Discussing the authority given the
boardto sell ships, Chairman Payne
said:
eve understand 1t Is the policy OF
congress that we cannot operate ships
if we can sell them and we must sell
all ships after five years"
Replying to Senator Calder, repub.
lican, New York, Chairman Payne said
shipping men felt that the govern,
ment would not discriminate agains
American ship operators In eompeti
tion with foreign ships In the matter
of prohibition
Concluding his statement. Chairman
Payne said the resolution presented tt
the committee was approved by tbs
shipping board by vote of to l.
Commissioner Stevens, who votet
against further attempts to sell tn
ships at present, then was called. HI
said he based his objection TO th'
present sale of the fleet on the groun'
that true value Of the vessels had nev
er been determined and the board
estimates were guess work"
Mr.. Stevens viii be heard again to
morrow and then John d. YsRk, rep
resenting William Randolph Hearst
will appear.