The Washington herald., 1922-12-07
Senator Jones House
Amendment Might lniure
Newly Organized Companies
|TEH.YEAR TRIAL NEEDED
Opposes Making Shipping Fund
Subject to AnnuatAppropria-
tons from the Congress
By Universal Service.

clared his unalterable opposition
to an amendment to the ship
subsidy bill adopted by the
House, making the allotments for
merchant marine aid subject to
annual appropriations by Con-
gress. The Executives views
were stated in q letter to Senator
Jones, chairman of the Commerce
Committee, which Is now consid-
ering the bill.
SUBSTITUTE OFFERED.
When the letter was read to the
Commerce Committee It provoked
long discussion. An attempt to
compromise the points at issue BE-
tween the Presidents insistence
that the amendment should 60 out
and the provisions Of the amend
ment itself was made by Senator
Lenroot. who drafted q substitute.
which other members Of the COM
mittee said they would accept. 1t
Will be submitted to the President.
and II approved by him may be
written into the bill at today's
meeting OF the committee.
ALLOTMENTS CURTAHED.
The substitute provides that the
original provisions In the bill
which were changed by the Madden
amendment. should remain un.
changed. but that no disbursements
for additional allotments beyond
those provided for by the bill
should be made except by express
authorization by Congress.
The Presidents letter follows:
NV Dear Senator Jones:
Referring to our conversation
relating to the merchant marine
bill as passed by the House, ! am
writing to urge with all the ear
nestness at my command that
the Senate Committee will elm
mate from the bill the amend
ment which makes the shipping
aid fund subject to annual ap.
preparations by the Congress.
understand that this amendment
was added without any thought
to emasculate the bill, mainly
! to harmonize II with an accepted
practice. of Congress IN making
annual appropriations in carry :
ing out government commitments
relating to improvements, reclama-
ton and other government prof.
ects.
PURPOSE OF BILL
1t is a very different PROPOSE
ton so far as the shipping hill
is concerned. Our chief object
is to establish and promote the
American merchant marine. The
ten-year commitment is made for
the purpose Of giving the plan
the necessary period of trial to
prove its success or failure. Ship
ping enterprise involves a very
considerable Investment Of capital.
Sometimes millions must be in
vested in a single ship, and no
shipping concern. with ample
ships to operate definite lines in
sustained service. could hope to
begin without enlistirg several
millions of capital. Much Of this
capital will necessarily be ac-
quired through the processes Of
direct subscription attended by
bonding.
RETURN OF EXCESS.
II In not believed that any finan.
cial concern would support a
bonding enterprise with an uncer-
tainty in the continuity Of gov
ernment aid throughout the ten
year period. OF course. govern
ment aid may cease in a much
shorter time. 1t will only cease,
however. in case the shipping
concern is earning sufficiently on
its capital to meet its oAliga-
tions under the terms of the bill,
which provides for automatic ces-
sation Of government aid and the
the return of excess profits to
the government. q
The outstanding objection to
the amendment lies in the fact
that 1t impades the organization
of the financing Of the new and
smaller shipping concerns which
it is designed to build up under
a favoring merchant marine
policy. 1t would be quite pos
sible for shipping concerns al
ready organized and financed to
avail themselves of government
aid without any more guarantee
than the bill. as passed by the
House, carries for them.
NEED OF CERTAINTY.
But our greater interest lies
in the organization and establish
ment and maintenance of new
shipping lines. and it Is inconceiv-
able TO me that any project
which would be dependent ON
government aid for the first few
years of the difficult work of
establishing itself could attract
any capital. either in stock sub
scription or bonds, unless the
government aid, which inspires
the enterprise, is substantially as
sured for a definite period.
OF course, it Ii a reasonable as
sumption that Congress. once
| pledged to a policy of Govern
ment aid, would carry on from
| year to year in accordance with
its enacted pledge. At the same
time. II must be recognized that
Congress unfavorable to the
] policy of Government aid might,
for one reason or another, inter.
rupt the appropriations and bring
about a collapse of the entire un
| dertaking. The mere possibility
| OF such q fiasco would undoubt.
/ edly deter the successful financ-
ing Of shipping projects and de.
feat the very object which the
merchant marine act sets out to
accomplish
Il