THE AMERICAN MERCHANT MARINE BY P. H. W. ROSS FOUNDER OF THE NATIONAL MARINE LEAGUE Once to be seen floating over all the seas, the American flag is now a stranger in foreign ports. The people of the United States are dependent upon aliens to carry and deliver their goods to other lands. The war has shown us how hazardous the present situation is. The best way to find out what the situa ion is and what ought to be done about it is to go to an authority on the subject. For that reason we have asked Mr. Ross, the President of the National Marine League of the United States of America, to answer some questions. We print our questions and Mr. Ross's answers herewith. Mr. Ross's point of view is not that of a mere theorist, but of a man of affairs who is heart and soul an American. Born in Bombay, India, he has had experience in many parts of the world. The holder of a degree from the University of Oxford, he began his practical experiences at the age of seventeen, in the Bank of England, where he worked for seven years. Roused by the reading of Mark Twain's "Roughing It," he determined to go out into new countries. With only six weeks' study in a Polyglot Institute, with the aid of his school Latin he managed to learn Portuguese, and thus prepared himself to take a thousand Portuguese laborers from the Azores to the sugar plantations of Hawaii. This experience of ordering the lives of nearly a thousand human beings for five months was invaluable to him. There was a mutiny on board, over eighty of the laborers died of fever, and all manner of things happened on the long voyage down the North and South Atlantic Oceans, round the Horn, and up the Pacific Ocean to Honolulu. For a year Mr. Ross was in the British Vice-Consulate, and there learned a good deal about the problems of mariners. For six years he was assistant manager and accountant on a large sugar plantation, and at the end of that time, besides thousands of acres of sugar-cane, the plantation had stores, a church, a school, a remarkable wharf cut down through three hundred feet of cliff, a railway system, a water works system, and an electric light system-all this on a plantation in mid-Pacific between 1883 and 1889. Then, having become thoroughly Americanized in Hawaii, he moved to the State of Washington, at once became a naturalized citizen of the United States, and subsequently organized the oldest bank in his county. For twenty-two years he was one of the builders of the Northwest. His experience on the Pacific coast impressed him with the wonderful maritime possibilities of the country. After a thorough investigation, he wrote a book dealing with maritime affairs. As a result of requests for addresses elicited by the publication of this book there was evolved the National Marine League of the United States of America, of which he is the President. It is to this League that Mr. Ross is now devoting all his time. The League has a perpetual charter, granted in Washington, D. C. There are branch offices in Boston and New York, and branches will eventually be established in all the large cities of the country.-THE EDITORS. I'm S the question of building up a merchant marine something that interests only the sea-coasts? On the contrary. It is a question that directly affects the daily prosperity of every laborer in the country, irrespective of where he may live or what his occupation or fortune may be. How can the building of merchant ships affect the people of Ohio or Arkansas! Our mills can make in six months as much as the country can consume in twelve. Mill hands in those States cannot have a steady job unless the things that they make, either with their hands or by the aid of machinery, are sold as regularly as they are made. Since the home market cannot absorb the full output of these mills, it follows that a large export trade must be developed. It is an absolute impossibility to develop an adequate export trade unless we have our own ships to carry those products to other countries. We must remember that all our exports, except those sent to Canada and Mexico. have to be carried in ships. But how about the farmer? Is he interested? The farmer's best market is in the United States, and just in proportion as the nonfarming population of America can purchase the farmer's products, to that extent is the farmer most benefited. And, furthermore, the same reasons apply to the export of agricultural produce, such as cotton, tobacco, etc., as to the manufactured products already mentioned. To what extent does a merchant marine that prior to the war Great Britain possessed no naval auxiliary ships, no hospital ships, no transports for troops, no colliers, no vessels for carrying munitions, horses, camels, or other supplies. Why did the Admiralty have none of these vessels? The answer is, because it had more sense. For years it had been keeping track of every vessel in the merchant marine. It knew exactly where these vessels were, and also knew that it could put its hand upon them the moment they were wanted, and that they could be obtained for governmental or national purposes at a moment's notice and at a very reasonable cost to the Government. Meanwhile these auxiliary forces were being maintained without a farthing's expense to the Government, and the ships were peacefully following the avocation of trade, to the great and enduring benefit and profit of the Nation itself. Thus you see that Great Britain's merchant marine constituted. not only a second line of defense, but was of itself an integral part of her first line of defensethe royal navy. For example, the British Government summoned five thousand wireless telegraphers from her merchant marine for military and naval purposes. I should like to know where Uncle Sam could get five hundred from the American merchant marine! Would the merchant marine help to train men who would be useful for their nation's defense? The history of the world has proved that there is no other agency in existence that can be compared to a training at sea for developing the virility and manhood of a nation's youth. To-day the dangers and excitements of frontier life have vanished, and, with the exception of Alaska and the Philippines, there is probably no United States territory left wherein young America can exercise its virility as it has done for the last fifty years. Once there was an ardent future for ardent spirits; to-day there is none unless we de velop the merchant marine which will carry not only products but American ideas and American ideals all over the world. There are thousands of active young chaps who crave adventure, and the life of the sea is just the sort of life for them. But are we not doing very well as we are without a merchant marine? In reply to that question let me quote President Jefferson, who, in 1793, said of navigation: Its value as a branch of industry is enhanced by the dependence of so many other branches upon it. In times of general peace it multiplies competitors for employment in transportation, and so keeps that at its proper level; and in times of war-that is to say, when those nations who may be our principal carriers shall be at war with each other-if we have not within ourselves the means of transportation, our produce must be exported in belligerent vessels at the increased expense of war freight and insurance, and the articles which will not bear that must perish on our hands. We have a pretty good example of that right now. But war, after all, is only an episode, and after this war, why can we not go on as w? were before the war? The reason is because American exporters are the paymasters of American indebtedness to foreign nations. More than five billion dollars' worth of American securities of one description or another are owned by people who do not live in the United States. The interest and dividends on these securities, plus the three hundred million dollars we pay to foreign countries for freight charges, plus the fifty million dollars or more that we pay in bank commissions, brokerages, and foreign insurances, plus the three hundred million dollars that people living in this country remit to relatives and friends in Europe and Asia, plus the five hundred million dollars that American tourists spend abroad in normal times, constitute an outgo or sub-current exceeding the balance of trade apparently in our favor by at least a billion dollars a year. The debt of the American people to other people is piling up at this awful rate every year. There is only one possible means by which this debt can be liquidated, and that is by a vastly increased volume of exports. We can never expect that this volume of exports will be very materially increased by the outward shipment of foodstuffs, therefore it must consist in greater part of manufactured products of one description or another. What are these ships of ours, that are carrying these exports outgoing, to bring back to us! We Tropical fruits, sugar, tea, coffee, rubber. wool, metals, chemicals, hardwoods, “keymaterials" such as ferro-manganese, tungsten, etc., and, in fact, all raw materials too numerous to mention, for our manufactures. must remember that, since this country has now arrived at the manufacturing stage of its evolution, we also need raw materials, just as England and Germany and other manufac turing countries have had to import them. Why, if we bring back all this material, 1916 THE AMERICAN MERCHANT MARINE will we not be in just the same position as we were before, and therefore be as badly in debt as before? Because the cargoes of raw material that come in do not begin to have the value that the cargoes of manufactured exports have. But why can we not let foreigners attend to the business of carrying out our exports while we attend to other things? If you are running a big department store and you find you have to deliver your goods to your customers in order to hold their trade, you do not engage the delivery wagons of a competitor who is trying to sell the same kind of goods to the same sort of people to whom you are trying to sell your goods. The thing is inconceivable. But is it not the duty of America first to develop her own resources rather than anything else? Certainly, and that is exactly what we are driving at, because the United States has been endowed with the most magnificent maritime resources of any nation on the face of the globe. We are possessed of eight thousand miles of magnificent sea-front, and of the most commanding, commercially strategic position in the world. With the old civilization of Europe on the one hand, and the still older civilization of Asia on the other, we make as little use of our maritime "talents " as if we were in Switzerland or Tibet. You remember the parable of the talents. They are of various kinds. Whole civilizations have flourished solely by the intelligent use of their maritime "talents," as was the case with the ancient Carthaginians, and is now the case with Great Britain. Even in Germany, with only one hundred and thirty-five miles of "maritime talents," they have developed a foreign trade. of five hundred million dollars per annum in excess of America's total foreign trade, although America has eight thousand miles of maritime talents." Indeed, the maritime resources of America will prove to be as remunerative as her continental or land resources of mines, forests, water powers, and the like. We have a moral duty to perform in the development of these talents which Providence has intrusted to our keeping. How can the great majority of Americans who never see sait water conceivably be interested in this question, important as it seems to be? Only by a campaign of popular education and constant reminders through the press 139 and by instruction in colleges and schools. This course of education was admirably carried on in Germany by the German Marine League. There are four thousand branches of the German Marine League scattered throughout the interior of the German Empire, and there is not a German laborer but knows that if he expects to have steady employment the things that he makes must be as steadily sold, and sold, if possible, outside of Germany itself, so that new money may come into the Empire, and the result of his labor be not a mere transfer of old money from one German pocket to another German pocket. Three hundred thousand school-children sing the praises of the German marine, and so thoroughly impregnated has the population become with the fact that maritime enterprise is complementary to the success of inland enterprise that the idea of questioning any effort for the betterment of the German mercantile marine would never enter their thoughts for a moment, any more than it would have entered the thoughts of our own population a hundred years ago. A hundred years ago the American people thoroughly understood that, but their thoughts have drifted away and they have to be recalled to what they once took for granted. Granted that a merchant marine is needed and very important, what methods can we use to build it up? There are several methods that might be advantageously employed. Among these might be enumerated the use of discriminating duties in favor of goods carried in American bottoms. Again, there is the possibility of some form of subvention or generous payment to ships for the carrying of United States mail, and especially for establishing new mail routes to countries with which our manufacturers must establish export trade relations. We can also pay the sailors themselves the difference between the American rate of wages and the average current nonAmerican rate. There is also the possibility of permitting lower rates on railway freight from interior points intended for export, and also the necessity of encouraging our manufacturers to develop a far larger proportion of their output for specialized export purposes. How does a discriminating duty work? Like this. An American ship, having arrived in a foreign port, naturally needs freight for her return voyage. The foreigner is induced to employ the American ship rather than the ship of some other nation because by so doing he will have a rebate of five per cent-or whatever the rate may be-on the tariff he would have to pay when his goods reached America. This policy was in existence for the first fifty years of our National life, and worked with such splendid results that from 1795 to 1860 we carried, on an average, eighty per cent of our overseas commerce in American vessels. To-day the percentage is less than ten per cent. Have we any treaties or agreements with foreign nations that would prevent us from doing this? Yes, but they are only like a lease or any other business agreement. All of these trade treaties are terminable at the will of either party. In fact, to give force to the Seamen's Act these self-same treaties now are in process of abrogation or modification. It must always be remembered that the most vital opposition to an American merchant marine has come from foreign sources. As foreign ship-owners have discriminated against American ships by allowing a five per cent rebate on goods carried in their ships, the only way in which the United States can get even is by allowing a discriminating duty on American ships. Are Government payments to ship-owners gifts out of the public treasury to a special interest, or does the Nation get a z alue received from them if they are properly arranged? As a matter of fact, the report of the Second Assistant Postmaster-General of the United States shows that American ships under contract for the carriage of United States mail were paid during 1915 $260,000 less than they would have received if they had not been under contract. As a rule, the public kicks at the idea of being taxed for something in which it has no apparent interest, but the public does not object if it is taxed as a whole for the sake of the seafaring people. The man in Kansas rebels at paying a tax when he thinks a few rich corporations in New York will get the benefit of that tax, but the land laborer is perfectly willing to help the sea laborer when he realizes that it is going to be of general public benefit to have sea labor. Could subventions be so arranged that it would be perfectly clear that the Government was getting value received! to keep a career open for the employment of its citizens in maritime affairs. It is impossible for a small group of American citi zens to keep a great industry open for the employment of perhaps one hundred thousand American seamen, and it is for the good of the Nation that those men should be employed and employed steadily, as a matter of National safety alone. Every seaman is a potential maritime policeman or defender. Would the payments that you suggest to American sailors to make up an adequate wage entitle the Government to their services in time of war? Unquestionably so. It is for that very reason that they receive this extra pay, and they would become a part of our maritime reserve, and their acceptance of this extra pay would bind them to that part of the bargain. Would this payment by the Government to American seamen constitute an investment which the country would have to safeguard by looking after the welfare of the men they paid! Yes; and we ought to welcome that responsibility for the sake of the Nation and for the sake of the individual. Anything is good that improves the selfrespect of the sailor and cements the tie that binds the sailor to his Government and to his country. There is a fine flavor of respectability and of independence about the American laboring man that you find nowhere else on the face of the earth. Why should this not be the same in the case of the sea laborer? Americans will not go to sea unless they can go on the same terms of self-respect as they can go to their work on land. already have that spirit of self-respect in our navy, and we must have it in our merchant marine if we are going to have a merchant marine at all. We How can the Nation encourage and direct manufacturers to take thought for making goods for export, thus providing something for our merchant marine to carry? I believe that the Inter-State Commerce Commission can help by amending its ruling allowing lower rail rates on exports and imports only to those carried in American vessels. I also believe that the Federal Trade Commission can help by permitting Americans to combine in matters of export trade, just as the German Government not only permits but encourages its exporters to do. If Germans are permitted to stand shoulder to shoulder in dealing with America, why cannot Americans be 1916 THE AMERICAN MERCHANT MARINE allowed to stand shoulder to shoulder in dealing with Germany or any other country? We live in an era of disintegration and distrust, and in order to get a merchant marine we must make it an era of combination and confidence. Is there any reason why part of the capital for our merchant marine should not be supplied by the railways that would feed that merchant marine with freight? I can see no possible reason why railways should not have the right to extend their facilities to their overseas termini. It must be remembered that the terminus of American products is not at some point on the seacoast of America itself, but at some chief distributive point in the country where those products will be sold. In other words, our termini lie across the seas; they are not here. The railways that bring passengers to Hoboken and Weehawken and Jersey City do not really bring their passengers to their destination until they take them across the river in some way to New York City; and the ferriage across the ocean is just as much a part of the railway's function as the trip across the river. If the railways were permitted to own merchant ships, would they not crowd out everybody else who wanted to go into the business? No; no more than a railway train can leave its rails and career all over the countryside like an automobile. Railway and steamer combination traffic is strictly limited to certain foreign termini, such as Nagasaki, Liverpool, London, Hamburg, etc. These ships follow certain ocean lanes almost as undeviatingly as the train glides along the rails. Such ocean traffic constitutes only one-twentieth of the ocean-borne traffic of the world, and a railway company could no more go into the tramp steamship business than it could fly. The danger is purely imaginary. The tramp steamers of Great Britain form about seventyfive per cent of her total ocean tonnage. What can the manufacturers themselves do to form the habit of thinking about making products for export? The best answer to that is the instance of how Seattle and San Francisco captured the Alaskan trade. At the time of the discovery of gold in Alaska there was a great rush of people there and they had to have supplies. Overnight there thus came to Seattle and San Francisco a new demand for goods. The merchants and manufacturers quickly adapted themselves to the circumstances, and made a study of the kind of goods required in 141 Alaska, and of the only available means of transportation at that time, which consisted of sledges drawn by dogs. Accordingly, only the best quality of goods could possibly be sent, and packing methods were entirely revolutionized and adapted to the conditions aforesaid. Similarly with all our manufacturers, as a whole. They already appreciate the fact that overhead charges run for twelve months in the year, and that the dispersion of skilled labor and the difficulty of reassembling it after a shut-down is a most serious impediment to their business success. They must also realize the fact that there is no stabilizer or equilibrator in manufacturing enterprise that begins to equal the export trade, and manufacturers must consequently devote at least twenty-five per cent of their energy to the development of foreign trade and its various requirements. What do you consider the most important factor in the whole question of American maritime development? A fixed habit of thought on the part of the entire population. We are always in danger "lest we forget." An instance of this occurred very recently. Mr. Whitman, the Governor of the most important maritime State in the Republic, so far forgot the necessity to the country of educating and maintaining the breed of men upon whose activities the economic future of the Republic depends that he actually recommended the abolition of the nautical training-ship of New York State; and this at the very moment when the whole Nation is agitating itself as to what is the best thing to do to make us maritimely independent. The Governor had nothing but good intentions in the matter, and when the importance of the training-ship was made evident by discussion he ceased to press the recommendation; but the episode indicates that his habit of mind did not lead him involuntarily to hold on to the necessity of the training-ship as an asset of incalculable value to the State. He probably was sore pressed by urgent requests to economize in one direction or another, and thought that this was a little affair of no particular moment that could be about as easily dropped as anything else. If this is true of the Governor of the State of New York, what can we expect of the average citizen of an inland State? What is the moral duty of America in this matter? I believe that a nation or an individual has to grow somewhat like a tree-that is |