The New York herald., 1922-04-07
Indirect Aids Promise to
Tighten Burdens Of
the Treasury.
WOULD BUILD SHIPPING
Senate and House Boards Get
Details of Proposed
Measure.


proposed by President Harding and
the Shipping Board would necessitate
q maximum Treasury outlay Of S52,-
OOO,O annually. Senate and House
committees considering the skip sub
sidy bill were told to-day by Chairman
Iasler of the board. Enactment OF
the legislation, however, would put an
end, he contended to the $50.O00,oo0
yearly loss the Shipping Board is sus-
tanning in operating It's vessels.
Pressed by Representative Davis
(Tenn), a Democrats member OF the
House Merchant Marine Committee
for an estimate Of the probable cost
Of tie Administrations programme
Mr.. Lasker gave general totals with
an explanation that experts would
give details later.
Suggesting that the chairman's esti-
mate did not take into consideration in
direct aids' provided for in the bill. Mr..
Davis asked what their money value
would be.
"Irs useless to try to estimate" Mr..
IAsler replied. adding that funds Tor
srndirect aids would not come from the
Government. Instead Of increasing the
burden on the Treasury. he held. such
aids would help Increase the revenues OF
shipping companies which. under the
hill. would be required. when their net
return exceeded 10 per cent, to turn half
the excess earnings back to the Govern
metat until the full amount Of the subsidy
was returned.
"Direct Aid" Detailed.
In computing s52.0oo.ooo as the prob
able Government expenditure for direct
aid" Mr.. Lasker said he allowed for con-
version into the merchant marine fund
$4,000, 600, to be derived from customs
receipts. 100000 in tonnage dues.
SIS. 900 now paid for transportation
OF certain classes of foreign malls and
$4,000, 900 in construction charges.
Accounting for the remaining $1o.-
600, 600. the chairman explained It was
expected tAxt deductions amounting to
this figure would be made In income
taxes payable by shipping companies.
The bin provides for such deductions.
The cost or maintaining the merchant
marine naval reserve. created by the
bin. would de betrayed from the mer-
chant marine fund, the committees were
Informed, and would not cause an addi-
4ional outlay from the Treasury. Cost
Of maintaining the reserve, Mr.. Lasker
estimated, would not exceed s3,o00,o00
annually.
while passage OF the bill would re-
ouire an expenditure of s52.00o.000 q
wear at most, the added burden on
the Treasury, the chairman said. would
approximate A7.00o.0Oo. as the Govern
nent now expends 8.o0.OO OF tho
amount which would be turned into
the merchant marine fund for trans
portation of foreign malls.
Must Carry Mails Free.
Under the bill vessels OF companies
receiving the Government subsidy
would be required to carry the United
States mails. except parcels posts, free
Of cost.
Mr.. Lasker said the maximum he
quoted would be expended only In the
event the bill Operates successfully"
and even then, probably not before five
years.
Questioned as to the advisabiiity of
dscontinuing army and navy trans
port services. the shipping board head
explained the bill would permit the
President to abolish them by executive
order. The subsidy program calls for
such action. Private shipping COM
panies would handle ocean troop
movements. fees received for such
service comprising one Of the indirect
aids provided for In the bill.
Mr.. LasSer said President Harding
had gone into this question even be-
fore the subsidy program was con-
siderec by him. and had concluded II
would be best to do away with the
army transport service.
Representative Edmonds (Pa.). a Re-
publican member OF the House commit
tee. remarked that an investigation OF
the transport question had revealed that.
compared with commercial rates. IL was
operated at a loss OF between five million
and six million dollars annually.
No Wall street Benefits.
At one juncture while discussing the
benefits that would accrue from enact
M1fUL Oh LHt Subsidy Dill, TIE chairman
declared that zone can talk all he wants
to about Wall Street. but II will be the
mass OF investors, not Wall Street, who
will benefit from this legislation"
I'VE must show the possibilities OF
making money In the shipping business, /"
he added. ''if we are TO get the public
20 invest in It,"
Cross-examination OF Mr. Lasker was
resumed to-day after the committees
lad heard the testimony Of r. II. Mont
gomery. n New York accountant. who
assisted In conducting a Shipping Board
inventory and aided In drafting the linz
itations OF profit provisions Of the sub
sldy bill. He said return of 10 per
cent. for shipping companies was 'rea-
sonable" in view OF the hazards TO
~hich the business was subjected.
Mr.. Montgomery said his firm had
sade an audit of the Shipping Board ac-
-ounts and that he was still acting as
an adviser to the board, but had received
no pay personally for his services
The bill, the witness said, would fully
protect' the Government from losses
sustained by shipping companies on ac-
count Of subsidiary interests. Such losses.
70 Z,ciared. could not be deducted in
rptuhting the net returns OF the COM