Evening star., 1934-01-25
BLACK DEMANDS
SUBSIDY CHANGES
Head of Probe Committee
Says Alternative Is
Abandonment.
Warning that the Government either

Warning that the Government either
must abandon or thoroughly overhaul
the subsidy system as applied to ocean
mail and air mail, was voiced last night
by Senator Hugo Black Of Alabama,
chairman Of the special Senate COM
mittee now investigating ocean and
air mail contracts, in the National
Radio Forum arranged by The WASH
ington Star and broadcast over q
coast -to-coast network of the National
Broadcasting Co.
The time has come for every person
who honestly desires to promote Amer
lean shipping and aviation to unite TO
release these industries from their sub
lection to proflteering promoters, stock
manipulators. bankers and privileged
politicians" Senator Black declared.
This cancerouS growth must pe CUT
from these essential American lndus-
tries. Our flag must remain on the
seas. Our aviation industry must go
forward"
"High Salaries Paid"
The speaker discussed revelations OF
diversion of Government funds intended
for subsidy purposes into the pockets OF
individuals, as disclosed before his In
vestigating Committee. Subsidy funds
paid by the Government to build up
merchant marine. he said, have been
largely spent in high salaries, extrava-
CANT expense accounts, highly PAID
lobbyists and huge dividends.
Turning to development OF the air
mail, he described "a wild scramble for
the fruits of Governmental subsidies
which gradually drove out the pioneer
aviation enterprises. The result he
said, was that lat the directors tables
there sat, not the pioneer air pilots, but
the masters of American finance"
1.-The control of aviation had been
ruthlessly taken away from men who
could fly and bestowed upon bankers,
brokers, promoters and politicians, Sit
ting in the inner offices, allotting among
themselves the taxpayers money, ne
said
Competitive bidding for ocean and
air mail contracts practically has van
ished. except in name only" he as
serted.
Text Of Address.
The text of Senator Blacks address
follows:
Since the beginning OF the World
War, the United States Government
has spent approximately $4,000,00O, 900
to build up an American merchant
marine. Practically all groups and
classes of American citizens have
favored some plan to keep the Amer
tcan flag on the sea. Great ocean
liners, sailing under the Stars and
Stripes. carrying freight and passengers
to the ports of the world, have thrilled
the hearts of patriotic citizens.
In the time of peace, these ships
have carried our cotton, wheat, steel,
iron and countless products OF 1arm
and mine and factory across the seas.
In time of war, our ships have served
to aid our country's cause and help TO
win our battles.
The peace-time value to national
commerce Of an adequate, modern,
well-manned fleet Of merchant ships
cannot easily be overestimated. In war
time seagoing vessels equal to the best
in all the world are of priceless worth.
II was because of both these elements
of value that our Government, largely
at public expense, increased Its gross
tonnage of ships in foreign trade from
slightly over 100000 tons In the year
1914 to slightly above 1l,0OO.OO0 tons
in 1921. The expressed object OF all
governmental aid given to the Merchant
Marine has been to:
Garry American goods IN American
bottoms.
Carry these goods at the cheapest
rate possible to return a taar prom.
Maintain a constant increase of ship
construction, in order to replace OLD
vessels with modern ships.
To employ American boys as seamen
and have them trained for sea service
IN casa of national peril,
II. S. Construction Lowest.
While the present inquiry has not
been finished. facts have already been
established that our program as ao-
ministered. has not. and cannot ac-
complish these results. From 1920 to
1888 the percentage of American goods
carried in American ships dropped from
43 per cent to 36 per cent. Today the
United States stands at the foot OF all
the nations of the world In ship con-
struction.
our ships, subsidized with the money
of the American taxpayer, have formed
combinations with foreign ships, hxlng
freight rates so high by such agree
ments as to place additional burdens
upon American farm, mine and factory.
The Jones-White law contemplated
requirement in each subsidy contract
that new ships should be constructed.
This was to maintain a modern mer-
chant marine In 1920 We had 1,OOO
ships In foreign commerce-today we
have 500. If every ship contracted with
the Government to be built should be
constructed. by the year 1910, this Gov
ernment would have a puny heet en-
gagged in foreign trade of less than IS
modern vessels. With reference to
training American boys to serve on the
sea. it is sad to relate, that the evl-
dence discloses that some of the ship
operators drawing the fattest subsidies
have employed the minimum number OF
Americans and sought to obtain the
passage of legislation to permit employ
ment by them of foreign seamen at low
wages.
It is impossible, in the short span
of time I am to talk. to give details OF
the evidence before our committee. The
record, however, discloses that the huge
subsidies paid by the Government to
build up merchant marine have been
diverted from the channel and have
been largely spent in high salaries, ex-
travagant expense accounts, highly PAID
lobbyists and huge dividends.