Evening star., 1933-02-20
MERCHANT MARINE
SHOWS BIG GROWTH
Fleet Increases From 112 to
600 Ships Since Be-
ginning of War.

| This is the first Of tho articles on
the reDiDdl OF the American Mer-
chant Marine
BY J. A. FOX.
When the World War broke out IL
1914, creating an unprecedented de-
mand for ships to handle the movement
Of men and supplies, the United States
once pre-eminent as a maritime Nation
had 112 ships of approximately 6oO, ,0O(
gross tons, trading to foreign and non
| contiguous possessions. Today the
American flag flies from some 600 ships
! of 3,500,000 gross tons, operating to the
same ports and transporting "a PEI
| cent of the trade of the country
The difference in the pictures is the
| difference between the inaction of pre-
war years and the efforts since that
| time to pursue a policy that will avoid
| recurrence of the pre-war situation, to
remedy which the sum of more than
$3,500,0O0,00O was spent.
Subsidy Is Supported.
Supporting the renaissance of the
| American merchant marine is the fac
tor OF mail pay-or subsidy-praised by
supporters and assailed by fees, which
has been in existence for the past five
years and now has just run the con-
greSsional gauntlet once more with ap-
proximately SGT 000.0 provided for it
for the next fiscal year, though the
Treasury Off1ce bill in which this
item is included is still tied up.
The return to the country, the chair
man of the Shipping Board, t. V.
O'Connor, says has been millions of
dollars represented in earnings, wages
and purchases involved in the operation
of the merchant fleet: freight charges,
been kept at a low level to the conse-
quent benefit of American shippers and
exporters. and additional foreign mar
kets have. been. opened.
1t was in 1920, when the country had
an opportunity to take stock and saw
that $500, 100000 had been sunk in
an attempt to build up merchant ma
rine over night, that Congress decided 1t
"is necessary for a national defense
and for the proper growth of its foreign
and domestic commerce that the United
States shall have merchant ma
rine -. owned and operated pri-
vately by citizens of the United States. "
Stability Sought.
For a starter, there was on hand a
usable-and useless-collnction Of ships
of steel. wood and cement that had
been bought, built and seized since
1916. In fact, right at that moment,
the Government was in the shipping
game with both feet, for tonnage was
in demand and the Shipping Board
was making money out Of its feet. 1t
was recognized, however, that actiyi-
ties were primarily of an emergency
nature and it was stabilization that
was sought through the new act Of
1920.
Under this law. the Shipping Board
practically was given carte blanche.
Because it was intended that the mer-
chant feet should be privately owned,
American interests were encouraged to
buy Shipping Board vessels and op-
crate them over routes designated by
the board, coastwise as well as foreign.
Where sales could not be made leas-
ing was to be encouraged and when
private operation was out of the ques-
tion the board itself was to operate
the lines it deemed necessary until they
became profitable enough to attract
buyers, or the board was convinced
their profitable operation was impos-
sible. The main idea was to keep
American vessels in service wherever
there was q chance OF doing a dollar s
worth Of business. -
Construction Loans Provided.
Further. there was provided a con-
struction loan fund of S125 900 900 for
operators who would build ships, or
recondition old ones, provided the work
was done in American yards This
was to be financed by liquidating hold
ings Of the Shipping Board, which in
cluded ships. shipyards. docks and
other marine appurtenances.
It was under these circumstances
that the American merchant marine
set out to regain the place it had held
in the lanes of trade in the proud days
OF the clipper ships.
AT first the Shipping Board proposed
70 run 88 lines, but, after a trade sur
vey, these were consolidated into 80.
For year or two, Chairman O'Con-
nor explained last year at hearing be-
fore the House Merchant Marine Com
mittee, the board operated all these
lines, but, in conformity with the law,
turned attention to getting the feet
into private hands.
incidentally, after 13 years. the board
Is just now about to reach this goal,
ale
OF the last three of its lines.
In an effort to stimulate private oper-
alton the board started putting lines in
the hands OF managing agents, under
agreements by which the operators
profits depended on gross business, with
tne Government footing the net losses
Later this plan was modified to permit
lump-sum payments to operators.
Further, the policy of selling lines al
a ngure below fair price, in return for
| guaranteed operation over essential
routes Tor term of years, was inaugu-
rated IN 1923 Between the discount
sales" and the agreements the Govern
ment was going deeper and deeper into
suoslolzed shipping, thus following the
example OF foreign countries, but still
the result was not satisfactory
SO, in 1928, the Jones-White act was
passed. This act reaff1rmed the princi-
pie OF that of 1920, but, more impor-
family, 1t furnished a new financial
stimulus both for construction and pri-
| vate operation.
| Primarily this was done by making
| eHectlVe a schedule of mail paw on 4
m1eage basis that would take up the
| dlHerential between American and for
elgn ship construction costs and oper-
alton. There also was authorizations n
double the construction loan find and
bring it to $3.50, 900. 600 ' ''--'
Ihere was nothing particularly neu
ABOUT the idea of mail compensation
or subsidy. In one form or another i,
mao been paid as far back as 1845 but
IN such hit-or-miss fashion that there
was little or nothing to show for a total
expenditure of $50, 600 600
System Is Attacked.
These mail payments have drawn the
PrnclpaI nre OF the opponents of the