The Birmingham age-herald., 1924-03-28
RECORDS CITED TO BACK CHARGE
 OF PREFERENCE }
Shipping Board Commis. sioner Answer Denial
 Of Jap Contract

WASHINGTON, March 27.-Fred- erick I. Thompson, commissioner of the United States shipping board, to- day issued the following statement in reply to the. denial of R. M Calkins, vice president; in charge of traffic of the Chicago. Milwaukee and St., Paul railroad, that preference in interchange of freight was given by that railroad to the Japaneses shipping line. Osaka Shosen Kaisha, through preferential contract in existence between the rail- road and the Japanese shipping inter est, and cited stenographic record of the hearings presided over by him in confirmation of his first statement re- specting the matter, to which MT. Cal kins issued bis denial The statement of Commissioners Thompson follows,
 The menory of Mir. Calkins is short and faulty. Alta hearing December l, 1921, between the United States shipping board and certain American railroads, stenographic record evidences that Mr. Calkins testified to the exist ence of such preferential contract. be- tween the railroad he represents and a Japanese shipping line.
 Admits ssFFeferred Service"
 Replying to the direct question, asked by me as chairman of the com mittee, if he would abrogate the con- tract, when it had been emphasized to Mir. Calkins that the. terms of the agree ment between the Chicago, Milwaukee and St. Paul and the Japanese shipping line was detrimental to the line, operat- ed by the gnxegnment of the United States, Mir. Calkins replied that it was
 
 If he would abrogate this contract, MT. Calkins replied that is point, if you please which ! would like to discuss with you further,' as he did not want to displace or recommend the displaee- ment of that contract 1,3
 The Chicago, Milwauke and St.. Paul railroad and the Great Northern railroad were the only two of the ten railroads represented at the hearing of December l, 1921, refusing to abro- gate or modify preferential contracts in existence between American rail- roads and foreign shipping interests, n further hearing was granted these two railroads on February l, 1922, by members. of the joint committee of the United States shipping board and the interstate compnerce commission.
 The stenographic record evidences that the American flag ships carried 1854 tons of commerce originating on the Great Northern and Chicago, Mil waukee and St. Paul railroads, of which the St. Paul contributed only 354 tons, while at the same time the ex- ports moving from the Puget Sound area were 76,1SS tons. The stenegraph- ie records attest that when asked the question, Has the Csntract been can celled between fts, St. Paul railroad and the Oshaka Shosen Kaisha,' Mir. CaIkins made direct reply that it has not been cancelled. It is in effect
 Present also at this hearing was Mr. Fl. B. Byram, the president of the Chicago, Milwaukee and St. Paul railroad. MT. Byram, in reply to a specific question, stated without equiv ocation: There is no use to waste any time; we admit it is a preferential contract. It says so.'
 Refufed By Record
 The record makes it self-evident that Mr. Calkins' denia! of preference { to ship line under foreign flag against ships operating under the Ametican flag is refuted and fully confirma- tory of the statement issued by me. To which MT. Calkins replied, that this preferential contract is distinctly harm ful to American flag ships, results in excessive losses to the taxpayers of the United States and that the application of section 2S would correct this ad- verse condition by giving to American flag ships under statutory regulation the same preference as is now being given by the Chicago, Milwaukee and St. Paul railroad to foreign flag ships under contractual relation. If the pfin- ciple of preferential contract between American railroads and foreign ship ping interests were accepted, the ulti- mate effect could mean only the control of ocean transportation by the rail carriers admission that railroads are entitled to grant preferential treatment to- any shipping company operating from a base terminal to the exclusion of free competition to the ocean and to the detriment of a competing port, would be admission that the govern ment of the United States would have no power to protect all ports or sus- tain the freedom of transportation on the seas."