New-York tribune., 1920-12-17

OF the law. are not in the best in.
terests of the seamen themselves ant
the navigation laws revision com
mnlttee, appointed by the Shipping
Board, has recommended their amend
ment. If che burden of these laws
cannot be removed by amendment. the
cost of them should be viewed as
the expense of public policy, taker
IN the seam-ns behalf, and reimbursed
TO ship owlers Ey some form of pub.
lie grant.
Government a Competitor
The third essential condition Of pri-
vate operation is the removal of com
petition by government ships.
Inc government, at the present time.
Is the largest ship owner in the world.
Its operation of the ships is not con-
troiled by the considerations of cost
and expense that Apply to private ship
owners. 1t operates its ships in COM
petition with private snip owners, in
the same trades. under the manage
ment of operators who have no invest
ment or permanent interest in the en-
terprlse. Its losses, which are reported
to be colossal, are borne by the tax
payers.
Competition by private ship owners
with their foreign competitors and with
their own government cannot long en-
dure. The real remedy is the with
drawal of the government from all
such competition.
The obstacles to profitable operation
which stand out boldly in the terms
and conditions heretofore offered by
the government as the basis of sale Of
the tonnage to private companies are:
nj q 10
with those of our competitors; the
unfavorable difference in operating
costs; governmental competition: and
the burdens arising. or that may arise,
from legislation. Among the burdens
from legislation are compliance with
the regulations made, and to be made
under powers granted to the Shipping
Board; the probability of trade wars
arising from the application of prefer
entail railroad rates on goods carried
or to be carried, in American bottoms,
and from the levy of discriminating
duties on cargocs carried in foreign
from duties on goods carried in Amer
lean bottoms.
Drastic Reduction Urged
The handicap of excessive capital
charges can be overcome in the adjust
ment of the price at which the ships
are sold and, as a practical matter.
in no other way. Without most drastic
cut in the prices that have heretofore
been asked by the Shipping Board, the
fleet cannot be sold % rrivate COM
panies, because investors will not fur
nish the money to buy them.
The valuation that must ultimately
be placed on the tonnage will bear no
rear relation to its original cost, nor
to the present cost of building, since
he world is oversupplied with tonnage,
and there will be no demand for the
Building of this class Of tonnage until
he present supply is absorbed and as
simulated. 1t will be the market value
as measured by the demand for it,,
nd by nothing else.
That market value is likely TO be
'cw. 1t will have tu be SO low that
the capital charges based upon it will
be reduced to the standard Of the
may have to be so low that the cost
other handicaps incideno to opera
ton under the American flag may be
taken care of in lower capital charges
than those of our competitors. This
is a condition which the authorities
in Washington are slow to realize, or
unwilling to face, but it must be real
lied and must 5e faced If crivate cap
ital is to be induced to invest, on a
large scale, in shipping for the for
eign trade.
The difference in the costs Of op-
Grafton could be taken care of by such
reduction in the price of tonnage
that the saving in capital charges
would equal the excess in operating
costs, or the difference can be equal
lied by some form of grant from the
Treasury.
The fear Of competition by the gov
ernmcnt could be removed by re-
quirement for the sale of the ton
mage within a short period of time, or
by the compulsory withdrawal of COM
petition by the government in the
trades where ships owned by private
companies are atfording reasonably
ADEQUATE service The latter alterna-
tive could be easily provided for by
the ALLEGATION or chartering to pur-
chasers, for operation, of any supple
mental tonnage that may be needed IN
such trades
(This is the fourth Of series Of
articles on the outlook for the new n,er-
chant marine. In to-morro1o's article
p. II. w. Ross, president Of the National
Marine League. III discuss development
of inland navigation and free ports as
essential factors.