increased to $2,636,074,737, while our ship tonnage had decreased to 943,750 tons.

We have seen that the leading nations of the world believe in and practice the granting of subsidies in one form or another.

Under our present tariff system, the Government grants a "regular allowance" to our manufacturers and farmers as a protection against foreign producers, which "allowance" is supposed to be reflected in the higher rate of wages paid to American labor. A higher cost to the consumer naturally follows, making each one of us a supporter of this subsidy.

Subsidy bills have been defeated in Congress on the ground that they gave direct grants to "special interests." The National Association of Manufacturers is certainly a pretty healthy combination of "special interests," and is keenly on the job whenever Congress proposes to tinker with its tariff subsidy.

When our transcontinental railways were building, the Government encouraged them with liberal land grantsland belonging to the people, now worth an enormous money equivalent and constituting a direct "gratuity."

We expend millions annually to improve our rivers and harbors, and subsidize the users of the same by exacting no tolls. This is also true of our inland canals.

The Agricultural Bill usually calls for millions of dollars each year, and money is freely appropriated when the South faces the cotton-boll weevil, when the West must fight the cattle tick, or some other section the hoof-and-mouth disease.

A prominent Indiana banker once told me that he didn't care what nation carried our commerce as long as it was carried. He is but one example of why we lack the necessary "pull together" spirit. Too much take, and too little give.

Free raw materials is a special privilege or subsidy to those manufacturers needing such materials.

Churches and other religious institutions, when exempt from taxation, enjoy a subsidy, and we all help pay it whether or not we approve of the exemption. One-seventh of New York City's real estate pays no taxes, without asking grace of the other six-sevenths.

Cheap Government water for irrigation purposes, as an inducement to settle on arid lands, is a direct subsidy, bounty, or gratuity. The Homestead Laws, which gave away our public lands for little or nothing, were the application of the subsidy on a tremendous scale, and resulted in the phenomenal growth and development of what are now our great grain-growing States.

Mail subsidies, or subventions, as some call them, are nothing but direct subsidies. If the amount paid is in excess of the regular rate on so much freight, it becomes a gratuity or grant to a "special interest."

IT

T isn't often that E. V. Lucas appears in the rôle of an indignant citizen. His whimsical observations on men and manners have accustomed the public to think of him as a keen but sympathetic observer of the world and his wife.

In his article on the Spanish bullfight, which will appear in an early issue of The Outlook, he has drawn the glove from his hand. But his ungloved hand wields his pen as skillfully as when it writes in a less trenchant mood. For vigorous description, vividness of utterance, and narrative power we commend to all our readers his forthcoming article:

WHENEVER I SEE

A GRAY HORSE

Fisheries bounties made Gloucester, Massachusetts, the fishing port of the New World and furnished the hardy sailors for our early merchant ships and

navy.

Our merchant marine seems to be about the only exception to the general rule of granting subsidies, bounties, or gratuities to privileged properties, proprietors, or persons.

There is considerable to be said in favor of Government ownership and operation, but we must bear in mind that on the ocean we are competing with every maritime nation of the world-a competition much more complex and exacting than that between domestic utilities, and perhaps requiring the initiative and vision of private operators financially interested in the ships; however, we score a point for Government ownership if we divest our minds of the opinion that all Government enterprises must show a profit. The Public Health, the Revenue Cutter, and the Life-Saving Services are indispensable, and yet yield no profits. Should we

abolish our Post Office Department when it shows a deficiency?

Our foreign commerce is a rich prize for the carrying nations of the world. The great international game of chess is on, and our opponents will try to check every move we make. Even with our great tonnage of new ships, backed either by subsidies or Government operation, can we hold our own in the game? In a commercial sense, it has been many long years since American ships enjoyed "the freedom of the seas."

Prior to the war the ocean trade of the world was controlled by the lines of a few nations through verbal and written agreements, the former known as conferences. By these lines the high seas were arbitrarily divided into a Mediterranean, a Continental, a North Atlantic, and various other Conferences, each mutually pledged not to encroach on the waters of the others.

Six German lines formed an organization known as the Syndikats Rhederer, which maintained four small steamers ready at all times to crush rivals by sailing from the same port at the same time and cutting rates.

In South America control by England and Germany was made effective through a system of rebates on all goods shipped by their lines. American ships found it difficult to secure a return cargo from South American ports. The English and German lines paid the rebates at the end of the year, and for one offense in shipping on an American vessel the shipper would lose all accumulated rebates.

The English and German Conference lines also maintained service between South America and Europe, and under the same rebate agreement. A South American shipper would lose all accrued European rebates by shipping one America-bound cargo in an American bottom. This was a pretty hard nut for us to crack, for, while we might prohibit rebating on all ships entering our ports, the English and German lines could hold the carrying trade between South America and the United States by doubling the rebates on shipments from South America to Europe.

The captains and deck officers of foreign carriers are naturally partial to the interests of their own countries, and are trained to promote the market for home goods.

Finally, we must consider the relative cost of building ships here and abroad. If Uncle Sam elects to stay in the shipping game as owner and operator, he can't expect to charge higher freight rates than his foreign competitors in order to justify the excessive cost of building. Unless he can reduce these excessive costs, the difference will have to be charged off against preparedness or the public welfare or something else.

Commercial sea power is the great prize of the world to-day. It was early won by the prowess of American ships, and then surrendered with hardly a struggle.

For many years following the coming

of the steel screw-propelled ship we seem to have lost sight of the fact that the day would come when our virgin resources would develop far beyond local consumption, and that we would become an export nation on a scale undreamed of. A few years ago ex-Secretary of the Treasury McAdoo stated that $300,000,000 annually was paid to foreign steamships for carrying our commerce. This sum ought to support a magnificent fleet

A

of American ships, maintain a large number of shipyards on repairs alone, especially stimulate the iron and steel trades and all other trades allied to ship-building, employ thousands of American sailors whose wages would support American homes, and, finally and of most vital moment to our own internal peace, American ships would be a big factor in insuring regularity of employment in American industry.

We must have a sufficient foreign market to absorb our surplus production, and there will never be any certainty of our getting it as long as we depend on the other fellow to deliver our goods; furthermore, American ships should make every dollar to be made in delivering this surplus and bring to American producers the colossal advertising value of sending the Stars and Stripes into all the ports of the world.

MEASURE is now pending under which a substantial appropriation is to be made from the Treasury -that is to say, by the taxpayers-to provide a subsidy for the maintenance and the development of American shipping.

Those who are believers in the importance of freedom of trade among the -nations, on ethical as well as on economic grounds, may properly object to any use of the money of the taxpayers for the promotion of one business interest or another.

If there is to be any contribution from the taxpayers for the support of an individual business interest, or of a group of such interests, free-traders for the most part take the position that a subsidy is the least objectionable form for such contribution. A subsidy makes provision for a specified payment, the amount of which payment is a matter of public record. The taxpayer is in a position to know what is to be the payment from his own pocket and for what the money is to be utilized.

We hold, however, that the burden of proof rests very decidedly upon the business concerns, or groups of concerns, which make application for such support from the Treasury-that is to say, from the taxpayers-to show that their industry is absolutely essential for the safety, or at least for the welfare, of the Nation, and to prove further that such industry cannot be established, or cannot be maintained, without help from the taxpayers.

It is possible to believe that there are certain industries (the number of these is, in my opinion, at best restricted) which may be called "essential" for the welfare, or possibly for the safety, of the State.

I have suggested, looking at the mat ter from the point of view of a freetrader, that the concerns, or groups of concerns, which are carrying on such industries, or which want to establish such industries, should be called upon to go before a commission (a commission which should be entirely outside of `politics) and submit proof that must be accepted by the commission as adequate, first, as to the importance of their industry or its necessity for the safety, or

PRESIDENT OF THE FREE TRADE LEAGUE

at least for the welfare, of the State, and further proof that the industry cannot be maintained, or possibly cannot be established, without help from the State-that is to say, from the taxpayers. They should then be called upon to state what amount of co-operation or support from the taxpayers will be required to put their industry on an assured foundation and to enable its operations to be carried on. The commission having accepted the view, after examining the evidence, that the industry is to be classed as "essential," and having arrived at an estimate of the amount of the subvention required, would recommend the payment from the Treasury of the amount decided to be necessary say, five million dollars or ten million dollars.

The amount so paid would be a matter of public record. The taxpayer would know which were the industries that were securing in this way the help of the taxpayers. Every citizen could know what the money was being used for.

We consider that a subsidy, made a matter of public record, is very much preferable to assistance given in the form of a tariff or duty. A voter very seldom can know what amount the country is called upon to pay, and in the end the individual citizen is under the necessity of paying, for assistance given to an industry in the form of a tariff. Provisions in the tariff are, in fact, not infrequently framed so as to make such knowledge difficult to understand. The amount of the contribution is hidden, and is meant to be hidden.

A commission, under my suggestion, would recommend that the subvention should be limited to a term of yearssay a period of five years-which might, with sufficient evidence presented as to the necessity or advisability of such action, very probably be renewed for a further term.

During the years in which a business was receiving this help from the taxpayers the accounts should be open for the inspection of representatives of the Treasury, as was done during the years of the war with certain "war industries." All proceeds secured by the business beyond a certain percentage

sufficient to cover the ordinary business risks, say fifteen per cent, should, as was done in the case of the war industries referred to, be paid into the National Treasury.

Further, irrespective of the term for which the subvention had been given, the managers of these industries would be at liberty, whenever they wanted to free themselves from the Government inspection of their books and from the necessity of paying over excess profits or proceeds beyond a certain fixed rate, to resign the subvention and to give up or get rid of the inspection and the payment of excess profits.

The schedule of the assisted indus tries should be a matter of public record.

Every citizen would be in a position to know what manufacturers or producers throughout the country had taken the position that they could not carry on their business without help from their fellow-citizens.

Payments of this kind, which are a matter of public record, payments to be classed as subsidies or subventions, are, in my judgment, infinitely preferable to the hidden assistance in the form of tariff duties, because, while they do constitute a burden upon all of the consumers and upon all of the taxpayers in the country, the precise extent of the burden or the amount secured by one favored trade or another can be known.

The makers of the tariffs do not intend that the extent of the tariff burdens should be known.

If the interests that are now pressing for a ship subsidy can make clear to the members of an impartial convention that such subsidy is "essential," that the ship-carrying trade is essential for the welfare of the Nation, and that Americans cannot conduct this business without aid from the Treasury (i. e., the taxpayers), and if a subsidy is made for a limited time, subject to the condi tions above proposed, I, as a free-trader, would not be prepared to oppose the

measure.

The voters will be in a position to decide whether the subsidized industry is of sufficient advantage to the country to be worth what it costs, and how long the taxpayers should continue to provide the money.

N°

ON-SUPPORT is a felony, under the law, in the District of Columbia, and is punishable by the criminal courts just as is arson, larceny, house-breaking, or any other misdemeanor. Until recently actions by wives against their husbands for failure to support them and their children came under the jurisdiction of the juvenile and probation court. A recent construction of the law, however, transferred them directly to the office of the United States District Attorney. The strictly technical execution of the law in such cases is of long duration, is expensive, and is generally quite lacking in the application of any helpful human relations.

Washington, for its population, has in the course of a year a quite large percentage of non-support cases-probably not more than in other cities, but more conspicuous because they are brought to public attention. Possibly the number is due in part to its colored population and the number of small wage-earners of the common labor type. It was apparent in October, when it became necessary for the District Attorney to assume non-support cases, that the courts would soon become clogged and congested and the jail overfilled with offenders under indictment awaiting

BY RICHARD B. WATROUS

trial. Before that condition could arise, however, a zealous officer of the city Police Department, detailed to the District Attorney's office to prepare cases for presentation to the Grand Jury, hit upon a method that in a quite unofficial application has proved to be expeditious, much less expensive, and altogether much more human in the disposition of cases of matrimonial disagreements and consequent non-support. Thus it has come about that George S. Weber, the officer in charge, with the co-operation of his brother detective Frank M. Helan, has, in effect, established and set in operation, almost before he knew what he was really doing, a "domestic relations court."

The procedure is a simple one. When an aggrieved wife appears at the office of the District Attorney to make complaint of a neglectful husband, she is referred to Mr. Weber, who, instead of passing the case directly to the Grand Jury, first ascertains what support the wife thinks her husband might afford to pay-it is amazing what small sums are frequently agreed upon-and also what prospects there may be of a reconciliation if the separated parties were brought together. He then writes in an unofficial way-that is, not by a formal summons process-to the husband, say

ing that the wife has made complaint against him for non-support and inviting him to appear at his office at three o'clock on the following Thursday afternoon to discuss the matter. It is usually arranged, without the knowl edge of the husband, that the wife shall be there at the same time. Each Thursday is a busy day-there is always a well-filled anteroom. The husbands usually appear, probably not infre quently because they think they must appear. Each one has a good "sit-down" talk with the officers, and then, if he is willing, the wife is brought in and they talk things over, with the result that the husband generally agrees to some form of support and very often family differences are healed then and there, and the two go away together, happy and thankful for the agency that has brought them together. If the husband does not appear, or if after the conference he is obstinate and will not promise to do his duty, his case goes to the Grand Jury the next day; generally he is indicted, and, if unable to obtain bail, remanded at once to jail to await trial, conviction, and sentence to a term in prison.

During the three months that this unique "domestic relations court" has been in existence the results have been