387 J?53s THE imzm imiii poligi. AN INVESTIGATION INTO THE Canses of lleBecltae of our SMpjlni Interesl COMPRISING A SPEECH DELIVERED BEFORE THE NATIONAL TARIFF CONVENTION ; AN ADDRESS BEFORE THE COMMITTEE ON POST OFFICES AND POST ROADS, AND AN ANSWER TO THE MISREPRESENTATIONS OF Mr. DAVID A. WELLS. BT JOHN ROACH, Esq. Amebicak Protectionist Publishing Compant, 805 Broadway, New Yorlf. 5E7 OUR MERCHANT MARINE. ADDRESS OF JOHN ROACH, ESQ. Mr. President, and Gentlemen of the Conven- tion: The war drove American ships from the ocean. American shipping interests were thoroughly destroyed by the operation of the last war; and the industry which was lost to America was replaced by the indus- try of the most grasping, enterprising, and intelligent of all the nations of the earth. In order that you, gen- tlemen, manufacturers, should understand the extent " to which the American shipping interest has a right to • I- complain, I put it to you in this plain, blunt way: ( What would you, as manufacturers, think if your fac- c^' tories had been literally swept out of existence by some '^process, and their place taken by English manufac- turers; and what remedy would you ask to have them restored to their original condition of prosperity and usefulness. The only remedy you could ask would be a proper protection: and that is the only remedy which the shipbuilding and shipowning interests of the coun- try ask of you now. We simply ask you to extend to us the helping hand that you have extended to your- • <; selves, to enable us to put the shipbuilding and ship- owning interests of the United States on the basis to which it is justly entitled. I, probably, have the strongest temptation of any man in the whole manufacturing interest to become a free- trader; but I am an American who believes that the true doctrine is to buy from American producers, know- ing, as I do, that it is the only safe way. In a spirit of explanation, and not in a spirit of egotism, I will read you a little list of the articles that are required to carry out the contracts I have on hand, or have undertaken between the 1st of January, 1880, and the 1st of Jan- uary, 1882. They are: 3450 tons of pig-iron, in round numbers representing a value of $86,250; manufactured iron plates, bars, angles, rivets, forgings, etc., 47,824,000 lbs., representing a value of $1,673,840; copper, 805,000 lbs., representing a value of $193,200. 4 Then without giving a detailed account of the value of every item, there is lead, 127,500 lbs.; lumber, 6 750 000 feet; coal, 18,000 tons. I doubt if, when this free shipping question was before Congress for many years, anybody v/as so tempted to be on the side of free shipbuilding as the poor shipbuilder. If our manufacturers understood how powerful a wedge the free-ship bill was in the interest of free trade. Some of our manufacturers had an idea that it did not affect their interest, but the following statement will explain I will not take up your time by remarks on each of the many articles contained in this list; but I will read it just as it is. Material and Outfits for Steamers Completed and Coiy tracted for by Mr. John Boach & Son, from Jan. 1, 1880, to Jan. 1, 1882. Pig-iron, 3450 tons $86,250 00 Manufactured iron plates, angles, bars, rivets forginirs, etc., 47,824,000 lbs. . . . 1,673,840 00 Copper, 805,000 lbs 193,200 00 . Lead, 127,500 lbs ^^^'^^^ Lumber, 6,750,000 feet « 305,000 00 Coal, 18,000 tons. . . ., 9Q>Q^Q $2,357,215 00 Anchors 9,780 96 Chains 22,968 42 Boas ; 16,650 00 Steam windlasses, manufactured by the Am. Ship Windlass Co, Providence, J ^ , 30,200 00 Capstans, steam and hand 8,^0^ Life-preservers 8,6.0 00 i'-:^"*"^*^ :::::::: 'SSS Deck iineV.V.'.V.V.V.V.V. V 14,^36 80 Lamps and lanterns 16,800 00 Naut ical instruments - . Flags 4.200 00 lligging wire, manilla, and blocks of'^nn aa Sails and awnings io A^n nn Canvas for decks. 13,8o0 00 s Plumbing and brassing Sqha Steam-pumps 27,800 00 Steam-gauges o,ouu uu Upholstery, bedding, linen, etc ^^l'5?6 60 Stoves and kitchen and cooking utensils. 17,809 60 Crockery and glassware 11,606 41 Gas and steam pipe and fittings 28,000 00 Hoisting-enfrines 35,600 00 Spars for masts. , 13,500 00 Paints and oil ^^'2^^ Joiners' hardware, loclis, screws, etc 16,700 00 Covering for boilers, pipes, etc. 18,000 00 Engineers' tools and instruments 9,000 00 Drawing paper, tracing cloth, etc 3,500 00 Cabin and stateroom furniture, chairs, tables, brushes, pails, baskets, cuspa- dores, etc 15,675 00 Glass for side lights and windows 5,860 00 Porcelain and glass name-plates 2,500 00 $674,350 83 Above $2,357,215 00 674,350 00 Total amount |3,031,565 00 The shipyards of Harlan & Hollingsworth, Cramp & Sons, and others, use goods of the same character. Here is a sum total of $3,031,565 worth of supplies bought in this country in one year. (Applause.) There never was a shrewder and a more determined blow aimed to strike down the whole protective system than there was in that free-ships movement. It went fur- ther than that, because it gave a great opportunity for smui2:gHng, and cheating the government. The owner of a^'sliip come here with a ship fitted up with every- thing; he could sell his whnl- outfit without paying duty, and go back to England and refit. Who ever thought that the free-shipping bill could have resuUed to the interest of the snmggler of free linens and free upholstery? This Convention is called together, as I under- stand it, for the purpose of discussing our prescni reve- nue laws. It is widely claimed, and no doul't it is 6 true, that there are some modifications necessary to be made in those laws. This would be wholly reasonable, as great changes have taken place since those laws were enacted. The subject is of the greatest importance to the whole country, for the continued agitation of the question of free trade and tariff for revenue only has disturbed capital and labor, and checked many an en- terprise. If there is no justice in the complaints of the advocates of free trade and tariff for revenue only, that fact should be made known. If there is reason for a change of policy or a modification of existing duties, that fact should be made known. What we want, gen- tlemen, is to get at the facts, and at the whole of them, and then have this matter settled, so that capital and labor may know just what is our fixed national policy, and may feel secure. If changes in our revenue laws are necessary, how shall they be made. Would it be wise to make them without thorough investigation? There is scarcely an industry in the whole country which is not affected by those laws in some way. The object of this Convention, therefore, is to make a careful investigation of the reve- nue laws and their operation, and see whether they are for the benefit of the whole country. I know of no work more important to be done, and to be done right. Andrew Jackson, whose broad statesmanship will not be questioned any more than will his love for America and her institutions, said: "Build your factories and workshops close to your plantations and your farms, and you will confer inestimable and innumerable bless- ings on the whole of the American people by that pol- icy." It was these words of Jackson that set me to studying the meaning and aim of protection. What do his words mean? Do they mean that we should take the product raised in Tennessee to Great Britain, 3500 miles away from the plantation? Ah, no! They mean that Jackson recognized that by doing both the raisnig and the manufacturing at home we should confer mes- timable blessings on our people. They mean that he recognized God's plan in making men fit for a diversity of employments, and that if this nation was to become great it must furnish employment within itself for all these diversified gifts. That idea of Jackson's, it seems to me, is the very bottom principle of protection. There is a radical difference of opinion about the reve- nue laws. On the one side are the men who have Studied the application of those laws to our industries 7 before they invested their capital in them, and with n view to such investment. Tliese men, we may be sure, have carefirlly considered the relations existmg in the production of manufactured articles between the rates of labor, capital, and taxation in this country and the other countries with which they have to compete. As practical men, engaged in the business of developing and building up American manufactures, their opinion must be of value and weight. On the other side are the men known as free-traders and tariff-for-revenue-only advocates. And of these men I may say, without injustice, that, so far as my experience has gone, they are men who have little or no capital invested in manufactures, who neither intend nor expect to invest any, and whose interest in this mat- ter is therefore to be sought for somewhere else than in the development of American industries. Some of these men are undoubtedly honest in their advocacy of free trade; but of such I think they are mistaken. Let us consider for a moment the tariff-for-revenue- onlv advocate, and see if we can dispose of him. It is claimed by this advocate that $130,000,000 a year is all the revenue required to pay the expenses of the govern- ment, and that this amount distributed on imported manufactured articles would furnish all the protection our manufacturing interests need, and that all beyond that is monopoly. Now I do not know the exact figures, but 1 know i am within the sum when I suppose, for the purposes of illustration, that there are invested in this country and in England $4,000,000,000 each in manufacturing inter- ests, for plant and working capital.* The average low- est annual rate of interest on this amount in the different States would be 7 per cent, or $280,000,000 a year. The rate of interest on the same amount in England would be 3 per cent, or $120,000,000. Add to this the $130,000,000 to be put on the English manufactures (though somewhat of this would go to France and Ger- many—say $10,000,000 of it) for revenue, and the ac- count stands thus: American manufactures, interest on $4,000,000,000. . • -$280,000,000 English manufactures, interest on $4,000,000,000 120,000,000 Engish manufactures, tariff for revenue 12 0,000,000 English advantage over American manufactures, an- nually $40,00J,uuu * As we had $3,000,000 in 1870, when the census of 1880 is done it will certainly show more than the sum I assume. 8 What protection, I should like to ask, would that taritf for revenue only be for American manufacturing interests? The simple amount of it is that a tariff for revenue only is nothing but free trade in disguise. It can be seen at once that the American working-man is left out in the cold. It means, practically, to throw open the whole of the ports and business of the country to the free competition of all other countries. Hence- forth we may treat the tariff- for-re venue-only advocate and the free-trader as working vu'tually for the same end, so far as our manufacturing interests are concerned. I have shown you the advantage possessed by 'the for- eign manufacturer in the matter of interest, and how that advantage alone wipes out the item of revenue tariff. Now let us look at another point — the vital point of this whole question — Labor. Suppose three different branches of business are started simultaneously in this country and in England, —a' woollen factory, a rolling-mill, and a shipyard, — each with a capacity of employing 1000 men. The average wages of these skilled workmen in either of these shops liere would be $2 a day, while in England it would be $1.20. The account would stand thus": Wages 1000 skilled American workmen, one week $12,000 Wages 1000 skilled English workmen, one week 7,200 Difference in wages in favor of English manufacturer, per week $4,800 Wage advantage of English manufacturer, per year $249,600 Now I want to ask any practical and sensible man how long the American factory could be run and its men be kept employed, in competition witli the English factory, unless one of two things was done: 1. Unless the wages of the American workmen were reduced to correspond with the wages of the English workmen ; or, 2. Unless by a duty the American labor was protected against the balf-paid labor of Europe, so as to enable the American employer to engage in the competition. The sooner our people understand this tariff question, that is not merely a question of tariff for revenue, but of protection for American labor -employed in the devel- opment of our industries and natural resources, the sooner will its right and sound economical solution be reached. Is it not plain that a tariff for revenue only would close nearly every workshop in our land? What would be the effect of that? Does the free- trader take into account the great interests that are 9 bound up in these workshops? Let us inquire Into this a little further, and see if tlie free-trader wants to give the American workingman an even chance to earn his present wages. . , . , It must not he forgotten that the factory m which the American workman is employed, that the tools he handles, and the capital that keeps him at work, all pay taxes for the support of the city, town, and county gov- ernment, for the maintenance of the schools where his children are educated, and for the support of the poor. These taxes add to the cost of the manufactured arti- ' cle. But the tariff for revenue only would allow the products to be poured in upon us of foreign factories, which pay nothing for the support of American insti- tutions. -, 1 ^ Now wliat I want the free-trader .to do is to be honest in this matter. It is certain, as I have said, that^ to enable our manufacturers to compete with foreign manufacturers under a tariff for revenue only, the cost of American labor must be reduced. As the free-trader, of course, disclaims the intention to close up any of our wwkshops, the only conclusion left hini is the reduction of the wages paid^to our labor. And so I want him to call meetings of the workingmen all over the country, and tell them frankly what his policy means, "Work- ingmen of America, you are now occupying a position that does not belong to your class. You enjoy too many of the comforts of life. You provide too well for your family; you are too well fed and clothed, you are al- together too well off. Men of your class in other countries do not fear as you do. We cannot compete with the manufacturers of these other countries, where labor is downtrodden and half-paid unless you will be content to receive the same half-pay wages and come down to the same squalid condition. It is your duty to do this. Why? So that we can adopt a policy based on the beautiful theory but practical absurdity of free trade. To whose good? Oh, to the good of foreign manufacturers and their agents and commission mer- chants in this country, who are all free-traders to a man." This is wdiat the free-trader ought in honesty to say to the workingmen. But instead, he too often tries to deceive by saying that a dollar in the old country will Imy more than a dollar and a half here. Does he tell the truth in that? Do not the bread and meat go from here there, and are they not cheaper here where they 10 are produced? Yes; and more than that, it makes little difference to the foreign workin^man what the prices of even those necessaries are, since he cannot afford to buy meat save as a luxury in his own coun- try. What can he buy cheaper? The few and poor clothes that he wears; and even these are only cheaper because the men who make them are half paid. What he can buy cheaper he is mostly unable to buy at all. It takes all his scanty wages to get food for himself and family, and he considers himself lucky if he can get that, though it is not such food as he gets here.. The best answ^er to the talk about the greater pur- chasing capacity of the dollar in Europe is to go to Castle Garden and inspect the thousands of poor, honest mechanics that land there. Look them over from head to foot and you will see w^hat the purchasing capacity of their day's wages is; then look at them again, after they have been here a few years, and mark the difference. But this workingman has come from that very condition of free trade which this country is urged to adopt. How is this? If free trade will be so 2:ood for America and American labor, how is it that it has proved so bad for European labor? If it has proved bad there, why should it prove good here? And why should any sane man fool around with dynamite, w^hen he has just seen an explosion from handling that dangerous material? It is certain that free trade will not aid the ximerican manufacturer and w^orkingman. But the free-trader declares that it will benefit the farmer. On the farmer he makes his strong point. He tells him that if he could buy his plough, his wagon, his clothing, and so on, from foreio-n manufacturers, and exchange for them the products of his farm, he could save from 10 to 25 per cent. It tells him that he could then buy for $9 what lie now pays $12 for. But it does not tell him that by this policy he would lose his home market, and hence his means of getting even the $9. It does not tell him that of all the agricultural products of the United States, only one tenth is sent to foreign markets; and not so much as that unless a short crop in Europe creates an extra demand. Now, let the farmer draw a line and put on one side the farmer and all who are employed to produce the agricultural crop. Put on the other side the vast number of people engaged in in- dustrial pursuits, from the mine to the factory, and those also in professional and business pursuits. Tlie 11 former are flie agricultural producers, the latter are the consumers, who, at least, use six-tenths of this whole crop, allowing three-tenths for the farmers themselves and one-tenth for the foreign market. Reduce the wages of the workingmen, who make a majority of the consumers, and you at once reduce the buying capacity of all the rest; for the landlord must take lower rents and the doctor smaller fees, and the merchant must either sell lower or less, and so oh. And in this reduction you have also reduced the capa- city of the whole community of consumers to buy from the farmer. He must either lower his price and lose his profits, or see his grain rot on his hands. A splendid benefit free trade would be to him, wouldn't it?— de- stroying the market which consumes nine-tenths of his products, in order that he may buy cheap goods in the market that consumes one-tenth of his products, and will only take that at an almost profitless price, or when the home crop in Europe is short. When the farmer investigates this subject he will see how false is the declaration that free trade would benefit him. ^ Tii8 wonderful growth and prosperity of the Vyest have been sounded all over the world. But the time was when the West had all the great natural wealth which it has to-day, and was burning its corn for fuel because there was, no market for it. What made for the great West the market that has brought it wealth and prosperity? Was it not the policy that developed the mines of the North and West, that built up factories and workshops, that brought hundreds of t)iousands of workingmen to fill them? That was what created the home market. And under that policy the North and West have prospered. Reduce the purchasing capacity of the workingmen, manufacturers, and mechanics of the North and West, and you destroy their prosperity to that extent. Again, if you close up the factories by this free-trade or tariff-for-revenue policy, what are you going to do with the workingmen? Nothing would be left for them but to turn to the government lands. Over-pro duction must follow, and over-production in this line would be as fatal to the farming interests as over-pro- duction in the manufacturing line is to the manufac- turers. And more so, for the products of the loom and the anvil will keep for a better market, while those of the farm will rot. 13 Again we must ask, then, who is to be benefited by our adoption of free trade? Surely some one, or why this constant outcry? The popuktion of Great Britain is about 38,000,000. She has capital invested and skilled labor euouo-h to supply the wants of 200,000,000; that is, she can^pro- duce of manufactured goods five times more than she can use. She cannot raise her own bread or meat. She is using all her powerful influence in this country, in my judgment, to establish here a policv bv which she can send the surplus products of her workshops to us in exchange for bread and meat and cotton. To do that our workshops must be closed up and our skilled labor sent to the cotton and corn fields. . That is the consum- mation which the English free-traders are moving heaven and earth to bring about. How does it look to have a foreign people sending pamphlets to American farmers, asking them to support only candidates who will vote in Congress for free trade— which means vote in support of the English interests against our own— and it cannot be denied that those pamphlets are circu- lated: they are here now by the thousand. It is well to note, in this connection, what argument certain English employers used recently to induce strik- ing cotton weavers to return to work at starvation wages.^ The employers told them, to quote from the English press, that they could not pay more at present because they had to put their goods into the American market at the lowest price, to break up the American manufacturers; that they hoped soon to accomplish that, since there were good prospects that free trade would be adopted in America, and if it was, within a year they would be able to pay their men good wages, and promised to do so. Ancl on those conditions the men went to work. I give this because it is so often said to be a specious plea to talk about England's taking any direct interest in our affairs or using the avenues of influence at her control here. The fact is, that England is making her great fight for tiiis market. Her manufactories are too large, while ours are too small. If she could onlv in- duce us to adopt the policy of free trade, which she adopted only when she had developed her industries to such a point, and brouglit labor and capital to such cheapness that competition by other nations was impos- sible on ajree-trade basis, her drooping industries would immediately begiu to revive,' since she has the advan- 13 taffes to-day of cheap capital and labor. As I have shown, the labor question lies at the bottom of our dis- advantage in an equal competition. So I want the tree- trader to prove to the American workingmen and to the American people why it is that we should do what could bnly injure ourselves in order to advance the mlerests ot a foreign nation. i i t As for me, I am content to let well enough alone, i find that Mr. Colquitt, one of the most emment ot the Eno'lish statisticians, estimates that the United btates is accumulatiniT wealth at the rate of at least $2,500,000 a day or in round numbers $1,000,000,000 a year and that all the indications point to a continuance of this increasingly prosperous condition. We are novy en3oy- ino- a s-eneral prosperity and growth in material wealth unparalleled in history. Why should this prosperity be disturbed and broken in upon by a crusade in the inter- est of free trade— a something, by the way, that does not actually mean free trade at all for us in its practical workings? Why should we now, in our highly pros- perous condition, begin to experiment? But when you get the free-trader into a corner he always cries out monopoly. It is claimed by the advo- cates of a tariff for revenue only— which means practi- cally free trade— that our protective tariff is a monopoly in the interest of the few, and works to the detriment of the many; or, as they frequently put it, a tax on the many for the benefit of the few. ^ I, for one, wish to say that if there is a single law which can be construed to give preference or benefit to one man over another, or protection to any class of men that is not extended to all, including even foreign capi- ' tal invested under our laws and subject to taxation for the support of our government and protection of Ameri- can labor, I say, wipe it out. Can any free-trader point out a single line m any rev- enue law that gives anything not equally free to all our 50 000,000 of people? Are not the rivers, the forests and mines free to all? Then where is the monopoly? You might as well say that the corn-grower of Iowa or Illinois, or the cotton-grower of Mississippi, is a mo- nopolist, as to call the manufacturer or shipbuilder a monopolist. I will give you, now, a few facts to show the progress we have made under the abused revenue laws, and hope to be able to convince any fair-minded man that they have worked for the benefit of the whole country. Ut 14 us take, first, the father of all monopolies (for such the free-tmder calls it), the iron interest. What has niade England the richest nation and the largest manufacturing nation in the world? Her re- sources in iron and coal and the use she has made of them. She has neither cotton nor breadstuffs nor the power to produce them, and is dependent upon us for these necessaries of life, while we have these and the coal and iron in boundless abundance besides. And for ourselves, I firmly believe that were it not for iron, and the use we have made of it, you could not hold this immense territory known as the United States under one central government. Then our brethren be- yond the Rocky Mountains would have to sail round Cape Horn 15,000 miles, to come to make laws for the nation, or down the Pacific Ocean, crossing the Isthmus of Panama, again reshipping at Aspinwall to New York. All of our patriotism, love of country, even the influ- ences of the Christian religion, could not control this vast territory under one central government. Our breth- ren would say we cannot suffer this great inconvenience. We must have a government of our own. With all the great natural advantages of this country, if this resource of iron had been withheld, would we not be apt to cry that the Great Father of the Universe made a mistake in not giving iron to develop the other resources? ^ And when we have the iron, shall we now leave it in the mine undeveloped, and depend on foreigners to supply a material of so vast importance to us, and with no other reason to give, only that we refuse to degrade and crush labor? I call your attention now to a few figures of iron pro- duotion : In 1870 we took from the mines— Tons. Of ore 3,655,215 To smelt this into pig required— Of limestone • I'rnn'nnn Of ponl 4,500,000 Of Xv;;:;;;:.v;.. v. 1.000,000 Thus making of transportation more than. . . 10,655,000 In the next ten years to 1880 these figures had doubled. Thus, in 1880 we took from the mines— ^m^s Of ore. 7,709,708 To smelt this into pig required— 15 Of limestone Of coal Of coke 3,169,149 8,981,553 2,277,555 An increase of 98 per cent, making of transportation a total of above 22,000,000 tons of transportation fur- nished merely to change the ore into pig. Have the men engaged in transportation no interest in this? Shall we leave these 22,000,000 tons of ore, coal, and limestone buried in our own soil and encourage their development in a foreign land, simply because labor is cheaper, and consequently productions of all kinds cheaper? Will any one say what the effect would be to this nation of drawing each year from our financial resources and sending it abroad to purchase our annual supply? Would not this increase the cost of iron in the country we purchase it from? Shall this transportation, shown to be so immense, be done in this country or in a foreign one? And what would be the loss to our inland carrying-trade if this vast freightage from the mine to the furnace were shut off. In fact the whole freight w^ould go to foreign ship owners. Besides, this is only the first freightage; made into pig and into various forms and shapes, it is then distributed into all parts of the land, to be worked up into all forms for use. So it furnishes transportation again and again until it reaches the merchant's counter. Remember this transportation is labor. These 7,709,708 tons of material, which was worth but 30 cents a ton in the mine, w^as increased in value to $100,557,685, when it had merely been made into iron and steel billets and muck bars. The value it would attain when worked up into all the conceivable forms for use, from the plough to the knife-blade, from the axe to the surgeon's lancet, and from the ship-plate to the watch-spring, cannot be esti- mated. But what has been applied to create this value? Labor, nothing but labor. Now will the free-trader compute for us the value of this in dollars when worked into all the shapes we use it in; the number of men in all the mechanical trades who draw their support in this country from working up this pig into its various forms and values? Then let VALUE OP IRON INCREASED. 16 him consider the families dependent upon these me- chanics and laborers, and tell us what is to become of them if iron and its products are purchased abroad? The principle is the same with many of the other indus- tries. Nothino; but labor has increased the value of the iron,' from the^ore up, and this labor is cheaper in for- eio-n countries; so that if ore can be converted into iron at°less cost, so can all other things that are to be made of that iron. So it all comes back to the bottom ques- tion : Will you degrade American labor or will you pro- tect it? I wish this question was put to the boys of our public schools. Some of our statesmen could learn wisdom from their fi2:ures. Every workintrman owes it to himself, to his family, and his" countryfto take up this question and figure it out. The -epplication of labor to our natural resources is the source of our wealth and prosperity. By the devel- opment of these resources, and the providing of our people at home with the manufactured goods they need, how manv thousands of towns and cities have been built up from the swamp where the scrub oak grew to what they are today? To the extent we apply this labor we get rich; when we cease to apply it, we get ^°To dispose of the charge that the protective tariS raises and keeps up prices,"and to show that in fact the competition made possible bv the tariff reduces the cost, I will give some figures relating to ship-irou, steel- rails', and the locomotive. COST OF lEON, 1850 TO 1860. Fi^rures taken from Xew York prices show that the averafre price per pound of ship or tank iron from IboU to 1860 vears when we had a low tariff, was: For ship or tank plate, 4 cents; for flange iron, 5 cents; for angle iron, 3| cents; for rivets, 5 cents; average of the four classes of iron, 4^ cents. INCREASE IN IRON PRODUCTS. From 1870 to 1880, years of a high tariff, the iron products of this countrv increased about 100 per cent In those years it would be supposed that the increased demand w^ould create an increased price; yet, thoug^ ^vao-es were higher by 20 per cent between 18^0 aua 17 1880 than between 1850 and 1860, the price of iron was reduced under our high tariff by 25 per cent. This is a positive proof tliat to have cheap iron we must de- pend not upon a foreign market, but upon the competi- tion, energy, and enterprise of our own people. As proof of what I have just said, allow me again to refer to figures taken from official records, which show that from 1870 to 1881 prices were as follows: Ship or tank plates, 2^ cents; flange iron, 4 cents; angle iron, 2i cents; rivets,* 4^ cents; average of the four classes of iron, 3f cents, or 25 per cent less than in 1850 and 1860. THE GREAT STEEL-RAIL MONOPOLY. The following shows the price, in sterling and in dol- lars, free on board, in British ports, of steel rails, from 1863 to 1875, per ton of 2240 pounds, compiled by H. V. Poor, New York: 1863'. 18 9 $89.79 1864 17 12 85.65 1865 16 7 79.56 1866 14 10 70.56 1867 13 10 65.70 1868 12 12 61.82 1869 11 6 54.99 Add to the above the premium on gold. Net tons of Bessemer steel rails produced in the United States from 1867 to 1880, inclusive: 1867 2550- 1868, 7225; 1869, 9650; 1870, 34,000; 1871, 88,250- 1872' 94,070; 1873, 129,015; 1874, 144,944; 1875, 290,863; 1876, 412,461; 1877, 432,169; 1878, 550,398; 1879, 683 - 964; 1880, 954,460. At a valuation of $65 per ton this would amount to $245,961,235. Ninety per cent of this enormous sum was paid to American labor. And here comes in the significant fact that before steel rails were made in America those purchased in England for American use were costing $80 per ton, gold, or 30 per cent more than they are sold for now in America. Who, then, had the monopoly? No one then heard about this great monopoly. When we were send- ing the gold out of the country ,^giving employment to foreign labor and allowing our own labor to go idle, was this policy in the interest of this country or of England? We never hear of monopoly in this couij- 1870 10 7 $50.37 1871....... .11 6 54.99 1872 13 18 67.54 1873 16 9 80.05 1874........ 13 2 68.75 1875 9 2 44.28 18 try until we begin to supply our own wants and cease buyino- in England. That is what a po hey of protec- tion has done for us in regard to steel rails. THE LOCOMOTIVE. Now I want to call your attention briefly to what we have done in buildingUe locomotive. . T^^t ^ill sliow the development of another American industry, ^itty years a^-o we imported a locomotive engine from Eng- land as a sample. I made an examination some time smce as to the number of locomotives now m the Lmted States, the cost of their construction and how it com- pares With the cost of construction m other countries. The number of locomotives in use in this country Jau- nuary 1 1879, was estimated at 16,44d, valued at $164,- 450 000 The number of cars in use, not including palace cars, was estimated low at 498,000 which would cost at least $600,000,000, making the value of locomo- ^^ri o.H ..r« tocrkher. ^764.450,000. Besides as much tives and cars together, $764,450,000. Besides as much as one-tenth of the total now runnmg must have been rebuilt say five times since 1830, at a cost of |d8^,^^o,- OOrmaMng a grand total of $1,146 675,000, which is more than England has invested in ships. But besides this we have built locomotives for export to all parts of the world, owing to the recognized superiority ot the American locomotive. ^ , , . The Baldwin Locomotive Works alone sent out ol the country from 1870 to 1880 over 520 locomotives, 152 of them to English colonies; and of the locomo- tives used in the English colonies from 9d to 98 per cent were built in the United States. Estimating what other shops have done, we ha^e ex- ported since 1870 $20,000,000 worth of locomotives and double that amount of cars. We have, then, succeeded in building locomotive, of such quality and at such prices that we have takeii Eng^ land-s locomotive business away from her in o.n n colonies. Is there any reason why, when our ship- building shall be equally encouraged and ^ejelop^ed b> extending our trade and making a demand for it, ^^e should not build ships for those countries which have not the resources to build them for themselves But then we are told that wliile we can build he lo- comotive and the car we cannot build t^^^ ^hip though that is built out of the same material and from the same forest and mine, and though the labor required to con- vert 100 tons of pig-iron into locomotives is much greater 19 than it is in the finished ship and just as high priced. But we had a policy for building the locomotive, by finding a use for it, and you see the result. THE SHIP. Lastly, let us consider for a few moments the ship. I have shown vou the mighty strides we have made in the development of the steel rail and the locomotive. The vast growth of our industries in general is shown by the fact that in 1870 the total value of manufactured articles made in the United States was $4,232,325,442, an amount which will no doubt be largely increased by the census figures of 1880. No other country in the world has developed as we have in the last ten years. We have protected our industries, and aided in the de- velopment of our agricultural resources through the building of railroads and opening up land communica- tion to market. We have built up our manufacturing interests beyond all our expectations, and by so doing have given a valuable and profitable home market to our farmers. This wonderful development we owe to protection. Had it not been for this protection, at the close of our civil war our factories would have been as scarce on the land as our ships in the foreign trade were on the sea, for we had given no protection to the ship. This wise policy of protecting our industries kept the factories open, and when the hundreds of thousands of men who went to the war returned home they found employment in the factories and workshops;^ but when the sailors were done with fighting, they found no ships to employ them. And, together with the loss of ships, we had lost the American hold on the foreign carrying trade. . But now to show what protection, smce that time, has done, I may say that the development of our coast carrying trade has exceeded, under protection, even our unparalleled progress in manufacturing industries. The history of the world does not show so vast a de- velopment as that of our coasting trade in the last ten years. Look at the figures. Counting in the contracts al- ready in hand that cannot be completed untd 1882, in the ten yeai's from 1872 wc have built 120 iron screw * It was a spectacle at which the world marvelled— the peace- ful disbanding of a million men, and their turning back from war to tbe workshops and the farms. What would they have done had not protection kept them work tpturn tP? 20 steamships, of a total tonnage of 230,000 tons. We have also built 25 wooden screw steamers, of 27,563 tons. This makes a total steam tonnage built for our coasting and foreign trade of nearly 260,000 tons, 230,- 000 tons of it iron steamships; while in 1870 there did not exist in this country the rolling-mills and shipyards required to construct an iron-ship such as we have to- day. Keferring for comparison to the ocean-going steam tonnage of the world in 1860, we find that it consisted of 338 steamers, with tonnage of 431,000, divided as fol- lows: Nation. No. Tonnage. 156 250.000 52 71,000 130 150,000 338 431,000 Ocean-going steam tonnage built in U. S. 145 257,563 What a grand showing this is! We have built in ten years more steam ocean-going tonnage than England jpossessed in 1860, though she began to build the iron ship in 1840, and had liberally encouraged the establish- ment of shipyards, paying millions yearly in postal con- tracts to induce the investment of capital in the foreign carrying trade. More than that: in these ten years we have built four times as much steam tonnage as we owned in 1860, while that was made up of old side-wheelers, not fit for ocean carrying; and have built considerably more than one-half as much steam tonnage as was owned by the world in 1860. The ships are first-class, and their car- rying capacity is equal to 1,287,815 tons of sail— the most approved estimates based on experience making one ton of steam equal in carrying capacity to five tons of sail. France and Germany made no increase of steam ton- nage to compare with ours, though they had all the ad- vantages of buying free ships of England [an advantage which the free-ship man claims would have done so much to gain for us a foreign carrying trade], while we labored under all the disadvantages of starting a new business, when the financial condition of the country 21 was unsettled, when gold was at a premium, and when for a part of the time there was great business depres- sion and distress. What has been the result, and what is the advanced condition of the iron-shipbuilding interest worth to us to-day? Had we possessed tliese 120 steamships in 1861, we could have thoroughly blockaded our coast, and have brought the rebellion to a close within a year. Through our present facilities we should be able to con- struct a similar fleet in much less time. Then, again, the building of this fleet has reduced the freight rates in the coasting trade nearly 50 per cent, since 1870, and our coasting fleet is superior to the steam fleet of any country except Engiand. How is this, do you ask? Why, we protected the coasting trade, tlie same as we did our manufactures, and so saved it; and the result is that the country has a better fleet, to meet an emergency with, than it ever had before. What a benelit this reduction has been to our own people, and yet it has been produced by competition among our- selves! It was the ship engaged in the foreign trade that was left unprotected ; and in consequence when the war came chcmce was afforded and taken to wrest the foreign car- rying business from us, and when the war was over we had none left. What we have done with the iron ship sin:;e 1872. in the face of financial discouragement, is sufticient proof of wh;it we can do to regain our place as ocean carriers, if a permanent policy and a wise one be adopted by the nation. It is no small thing to be able to say that this country is to-day the second iron-shipbuilding country of the world— second, only to England— and that, with- out reducing the cost of American labor; we have re- duced the original cost of the iron ship to within 12 per cent, of what it is in England, and can build a ship hav- ing no superior anywhere. I am siflisfied that our ten years' record in iron shipbuilding is such a record as ought to stop the mouths of the men who declare that Americans cannot build iron ships, and must depend upon England for theni. What we want is a wise policy to enable the merchant to own and run the ship after it is built, and then we shall succeed. FUEE SHIPS. Just a few minutes more, in which to dispose of the free ship ad vocate. He «ays first, last, and all the time. 3S tliat we cannot own snips Decause' we cannot buy them In the cheapest market, namely, in England. He will see no difficulty but that, he will accept no remedy tor our depressed foreign carrying trade that does not in- clude free ships. I want to show a few facts as to the free-ship cry. , , . What was our condition in 1865, when this cry was first raised in Congress? No ships but a few worn-out sailino-.ships and sidewheel steamers. No chance to compete with England's iron ships by building wooden ones; no facilities in the country to build iron ones; the carrying trade already in possession of foreigners, wuth their cheap capital, cheap labor, and low taxation; truiy a poor condition 1 , . r -ir ^ ''Give us free ships!" said the advocates of an Eng- lish interest to an American Congress. Well, i will show you that if Congress had bought and given ships absolutely free to these very advocates, they could not then have run them under the American flag. And tor these reasons: , , . ^ „ Suppose five 4000-ton steamers had been given to a company of free-ship men for nothing m 1865, the value of the ships being $5,000,000. The account at the end of a year would stand thus between him and his English competitor: Taxation of American Line on its $5,000,000 of Total taxation and running expenses ^^^^'^^^g ^^^q Interes\Tn^5'!U;666Vapit;i English Line at 4^^^^^^^ ner cent .•• ..»•••• tt Taxation, iper cent on net earnings, say earn- ^ ing 6 per cent • o^Q ^^n Wages 600 men at $4.35 per day • Total running expenses English Line $^,"7 50 Difference in favor of Englisli Line $86,350 Here is an advantage of ^^f^^SO a j^ear jhen the Americans were given their ships "fj ""'Ji^'^" MPffiunt is taken of nterest on capital; neither does thk ake into account tonnage dues, nor t 'e.«P^e^al ^var tnv And since the Americans who wanted fiee ships tor sti^ they did-could not expect to get thorn for S3 nothlns, llow would they have stood in the competition when they had turned $7,000,000 of greenbacks in o eold (as they must have done if they had used the privilege of eoing into a foreign market for then; ships) to buy what the Englishman or Frenchman or German could buy for $5,000,000; and when, besides this, they had pai/from 7 to 8 per cent for their capital. Just look at it : Running expenses and taxation American Line $563,000 Interest on $5,000,000 capital at 7 per cent. . . . 350,000 Total cost of American Line. ^^iH2n Total cost of English Line ^4?M^ Difference in favor of English Line $436,250 Now an American company of capitalists would have been very likely to invest in English cheap ships m 1865, and subsequently on those terms of competition, ^ Aid^yef the free-ship man unblushingly persists in saying, in the face of these figures. ^ Only give us free ships and we'll be all right.' Will we? Suppose, again, that two Enghsh companies, the Cunard and White Star, each wanted to start a new line of five steamships, both buying from the same place at the same price, and all conditions being equal save those of interest and taxation, the White Star having to accept the American rates in these two points, the year s account would stand thus: Capital White Star Line, 5 steamers ^^'2^n'nnn Interest, at 7 per cent Von cm Taxation, 2i per cent. - Total White Star cost $5,475,000 Capital Cunard Line, 5 steamers ^^'?22'nnn Interest, at 3i per cent ^.'V'";'" ^ ^^'^^^ Taxes, 1 per cent on 8 per cent dividend on capital jj ' Total Cunard cost :^$5479|000 Difference in favor of Cunard Line per year. $296,000 Or a difference of 6 per cent on the whole capital. I need not ask you which line would be likely to pay and sustain itself under such conditions of competition. 24 How much capital would the White Star Line be able to raise on a statement of these facts? "Which stock would sell best in the market? Yet the question of first cost, which is all the free-ship advocate finds to talk about, does not enter into any of these calculations I have made at all. Suppose the White Star Line had only the one difficulty to encounter of a 10 per cent ditference in original cost, that might be gotten over. Compare the ship on the sea to the. factory on the land. Both require capital for the plant and men to operate them. Xow, what' business man does not know of instances where two men are engaged in the same line of manufacture, and where one of them paid from fifteen to twenty per cent more for his plant than the other? But has any business man ever heard of a man's closing up his factory, and ceasing competition merely because his plant cost him more, all other things being equal? No, it is not the first cost that drives a man out of- the business. But suppose the one man's taxes were twenty times more, the wages of his hands twentj^-five to forty per cent higher, than those of the other — why, he would fail, though you gave him his plant for nothing. What man could *^buy a cheap Eng- lish factory, and run it on the American principle of high taxes, high capital, and high labor? So, in ships, it is not what it costs to get the ship afloat, but what it costs to keep her there, under American rates of taxa- tion, interest, and labor, that prevents us from owning ships in Competition with foreign owners, who employ capital under no such disadvantages. It is a noteworthy fact that this free-ship outcry never came from our American merchants who want to own ships. They laughed at it as folly, while its advocates were, mostly woufd-be merchants who were brokers and commission men, and wanted to run English ships on commission. ^ Let our government simply place us on equal condi- tions with other peoples, so that our capital can be put into competition Avith foreign capital, with a fair pros- pect of return, and I guarantee that there will be no trouble about first cost. As a proof of that, we have no ditficulty, as I have shown, in raising capital to be put into large American-built ocean steamers for the coast- ing trade, where it will be subject to the same laws, rates, and taxation as the other capital employed in that trade. But when w^e undertake to put capital into the foreign trade, we bring it into competition with the 25 capital of ottier peoples, who have more favorable con- ditions of interest, taxation and labor, and there we find the hunt for capital a vain one. The only way to get it is for our government to pursue the same policy that England did when she was in a like condition — en- courage capital to invest by opening up new marl^iets through the establishment of mail steamship lines. Moreover, we urgently need these new markets, and there is no other means except superior facilities of communication, mail and passenger, whereby we can obtain them. DANGER OF DEPENDENCE. ^ But taking it on another ground— the ground of na- tional independence and security. Is it on any conceivable ground a safe policy for us to^ become dependent upon a foreign nation for our ships ? Consider the vast and constantly increasing products we have to place in the markets of the world. We have by many millions of tons more surplus heavy products to be carried long distances than has any other nation. We exported last year over 11,000,000 tons. At the same rate of increase during the next ten years as during the last ten, in 1890 we shall export over 50,- 000,000 tons. We should require this year to place ourselves in our true position on the ocean, an outlay of some $75,000,000 to buy ships with; and each year, with its increased trade, would add to this large sum. In what interest can the man be working who advises us to buy from a foreign builder all these ships which we now need, and shall need, if we are to gain the place that belongs to us ? How can any American propose, in view of our future, to make us constantly dependent upon outsiders for anything which we have the means and ability to supply ourselves with ? What are Ihe great ocean steamship lines but the continuation of the trunk lines in transporting our products to market ? Why should we control those products on the land, and the moment we get them to the seaboard deliver them over to foreigners ? By that method we pay the freight for from 1000 to 2000 miles to our own people, and for from 3000 to 4500 miles to foreigners, when certainly the greater part of it should go to support American enterprise and labor. What would be thought of a pro- position to place our trunk lines in the hands of Enalish companies, and have them run under the control of England's government, with her flag hoisted on the 26 cars ? Yet we might do that with equally as much tea- son as surrender to them our products at the seaboard. I hope I have now disposed of the free-ship man, with his forever putting forward of the little difficulty of first cost, and keeping out of sight the great difficulties that keep us from owning ships and taking the position that belongs to us in the foreign carrying trade. The free-ship man never seems to see that if the $5,- 000,000 worth of ships are built at home, 90 per cent of that cost is labor, and all goes to the American working- man ; while by his method of saving the ten per cent all that immense capital would be sent to support foreign workingmen and a foreign government, and our natural resources would be left undeveloped. I think we shall be able to find a remedy better than that. What we want is an American policy— a policy wisely framed in our own national interest, not in any other nation's interest; a policy that will remove the unjust law that compels an American ship in the foreign trade to carry our mails, but refuses to pay it a reason- able compensation therefor; a policy that will make the competition equal in the foreign canying trade, and that will induce capital to invest in that trade; a policy that will protect and encourage the American industry of iron shipbuilding in the same spirit and to the same extent that our government protects and encourages other American industries; a policy, in short, non-par- tisan, non-sectional, but comprehensive, statesmanlike, national. Let Congress inaugurate such a policy, and the day will not be distant when again the American flag shall be seen in every port, when American pro- ducts shall be carried to every land in American-built ships, and when America shall once more be rapidly advancing to the position of the first great commercial and maritime nation of the w^orld. You ask me now, What shall we do ? I answer. The American mechanic, manufacturer, and merchant, the American sailor ask no protection for brains, push, or ino:enuity. All they ask is an equal chance in the com- petition. I liave shown that dear capital, well-paid labor, and high taxes cannot compete in manufacturing or shipowning with low taxes, cheap labor, and cheap capital. Look at what England did. With her iron mtercst well developed, able to build the iron ship cheaper than any other nation, with all the advantages of cheap labor, cheap capital, and low taxation, she yet gave aid 2? to her shipowners to encourage ana induce them to build fast mail vessels to open up new markets. ^ Wliy, from 1840 to 1880 she paid over $240,000,000 in this way to build up her shipping interest. France has aided her shipowners for years, and only this year, findino- it impossible to own a great merchant marine and buy it of England, passed a law offering a bounty for every iron steamship built in France— this encour- ao-ement being equal to $7,000,000 a year, including the sS'uspaid to those running French-built ships under the French flag. What is Germany talking of doing ? Prince Bismarck, in a recent speech, recognized the wisdom of the new French policy, said it would ''create for France a powerful navy, which may prove of effec- tive service in time of war," and declared that the "mer- chant service is the handmaid of all other industries, of ao-riculture and commerce. On the day when the freight t°ade is given over to foreigners," he therefore con- cluded ''a mortal blow will be dealt to all the indus- tries of the country. These enterprises cannot dis- pense with government aid, and this has always been afforded in a productive manner, as soon as it was a question of paving the way for our traffic in distant- markets. England has given the example of using mail steamers as the pioneers for the creation or expansion of commercial relations." These are the words of one of the keenest statesmen of Europe, and tliey are true words. We need ships to pave the way to traffic in new and distant markets, and, as Prince Bismarck says, tliese enterprises cannot dispense with a government policy of protection and encouragement. What is our government doing for the shipping interest ? Nothing but load it down with burdens and unjust laws. I have studied this whole subject and its difficulties. I have heard all the charges of monopoly; but I have found only one i^reat monopoly, and that is the monop- oly of labor. American labor has a monopoly of fair, livino- wages. It is true we are free to import this labor from^any'part of the world, but no sooner does it get over here than it joins the ranks of the monopolists and demands as high wages as labor here before it receives. It is this high-priced labor that makes the cost of the ship, as of our manufactured products, greater than it is in Europe. It is American labor that we protect by our protective tariff. And I say this is right. I say that we must continue to protect American labor. But shall we, then, leave our forests and mines undeveloped 28 because it has ever been and is the policy of our govern- ment to furnish labor with more favorable conditions than it knows elsewhere ? Is there no w^ay to build up American interests other than to crush down American labor? I will leave that question for the American peo- ple to answer. It is a pressing question that must be answered soon, in regard to our shipping at least. And anybody that, with the cry of free tracfe or any other, declares that American labor must be thrown into sud- den competition with the downtrodden and crushed labor of Europe, will very soon find that it needs our sympathy rather than our opposition. It will fall and be ground out of sight beneath the iron heel of that American labor, wiiose elevation and advancement is one of the strong pilhirs on w^hich the splendid structure of this free government rests secure. 29 ADDRESS BEFORE THE COMMITTEE ON POST-OFFICES AND POST- ROADS. The House Committee on Post-Offices and Post- Roads met on January 26th, Chairman Brigham pre- siding, for the purpose of giving audience to the Sub- Committee composed of Delegates representing the Na- tional Tariff Convention.* The Hon. H. C. Calkins was introduced, and ad- dressed the Committee briefly, explaining the action of the New York and Chicago Conventions, and the rea- sons for the appointment of a Sub-Committee to appear before the Senate Commerce Committee and the House Committee on Post-Offices and Post- Roads. He read the resolution on the decline of American shipping passed by the National Convention, and suggested the measures thought necessary to secure its revival. Those measures^ he said, were a reduction of the tax on the capital stock of vessels engaged in the foreign trade, a removal of onerous consul fees, alteration in the laws regarding the shipment of crews, and extra compensa- tion for postal service. Mr. Calkins alluded also to the action of the New York Chamber of Commerce, which went further than the Tariff Convention in recommend- ing legislative measures of reform, but advocated only the ground taken by the latter body. At the conclusion of his remarks the speaker intro- duced Mr. John Roach, who addressed the Committee on the subject of the shipping interests of the United States. * The members of the sub-jcommittee were Messrs. John Roach, Elihu Spicer, Jr., and H. C. Calkins, of New York ; F. W. Nicker- son, of Massachusetts: C. H. Cramp, of Pennsylvania; T. J", ^ause, of Delaware, and William I^g^rs, of Maine. 80 MR. ROACH'S ADDRESS. Mr. Chairman and Gentlemen of the Committee on Post- Offices and Post-Roads : In the National Industrial and Tariff Convention, held recently in New York, every branch of industry was represented. Never before to my knowledge, has such a variety of different and distinct industries been brought together. The farmer, the banker, the miller, and the watch-maker were there. When the various subjects before the Convention came to be discussed, and the views of the different representatives were set forth, it was shown that the interests of all these indus- tries were so interwoven that you could not injure one American industry without directly or indirectly in- juring others. And conversely, a benefit to one would be a benefit to all. A recognition of this plain fact shows how it is that a rapid and complete postal service is of importance to every productive interest of the country, manufacturing and agricultural. This service has grown with the demands of the country. Consider how we began with the pack-horse in our early days, and how we have developed from the mail-coach and the post, and the canal-boat to the lightning express and the steamboat. And see how in addition to these means business has called into requisition the telegraph. Wonderful has been the extension of the facilities of communication all over our land and throughout the world. Yet commerce demands still more, and there are markets which our commerce seeks to enter and needs to enter, but cannot because there the means of rapid and regular communi- cation have not yet been provided. In our early history, when we were only able to supply our own wants, the providing of postal facilities was properly confined to our own territory. But now that we have increased our products till we have a vast surplus to dispose of, not alone agricultural but manufacturing as well, we require new foreign markets, and to obtain these the demand comes home to you for increased postal com- munication. OUR INCREASING COMMERCE. Let me call your attention to our vast increase in all kinds of products, including manufactured goods, which was disposed of in foreign markets during the period from 1^369 to 1879. In 1869 our surpl>w was 2,5u0,000 31 tons and in 1879, it was 11,000,000 tons, or an increase of nearly 500 per cent. Should we increase m the same prS 1890 our surplus will be $55,000,000 tons We now pay to foreign ships for carrying this product $100,000,000, per year, and in 1890 we will pay ^4UU,- 000 000. This increase of our products, and its won- derful development, took place before we had resumed specie payment, and in 1873 we had a financial panic; rate of interest was higher, and the credit of the nation was not so well established. The prospect for the devel- opment of our resources during the next ten years is better than during the last ten years. We can produce cheaper: we are building more railroads; the tide ol immigration is rapidly increasing ; Europe cannot take more of our products than she now takes, and our difficulty will be to find new markets for our own production. TRADE WITH SOUTH AMERICA. I will further ask your attention to the markets of South America, and our present trade with that country. With proper facilities, a wonderful opportunity is offered to increase our trade with the South American countries. Exports to— Mexico Central America. Honduras West Indies Colombia Venezuela Guiana Brazil. Uruguay Argentine Chili Peru Ecuador $6,751,000 1,110,000 290,000 30,143,000 5,535,000 1,941,000 1,400,000 8,100,000 1,000,000 2,775,000 2,000,000 2,000,000 750,000 Imports PROM— $5,493,000 2,252,000 217,000 78,532,000 7,187,000 5,576,000 928,000 51,970,000 5,545,000 6,000,000 1,254,000 500,000 500,000 Total TRADE, $12,244,000 3,362,000 507,000 108,675,000 12,722,000 7,517,000 2,328,000 60,070,000 6,545,000 8,775,000 3,254,000 2,500,000 1,250,000 $63,795,000 $165,954,000 1 $229,749,000 Balance of trade against us, 1880 $102,159,000 With the exception of Mexico, we have no mail com- munication direct with these countries, and the Mexican 82 Government pays to keep that service up. I observed recently that the American Minister to Brazil was obliged to go on an English ship, ma Europe, to reach his post — 3,500 miles out of his way. How humiliating ! Every dollar of this enormous trade is settled for by ex- change on London, and our American manufacturers and producers pay the discount, which would more than pay for the establishment of rapid mail communication with each country mentioned. ENGLISH COMMERCIAL POLICY. The present control which England holds on the ocean and the markets of the world has been the work of forty years, and for two hundred years she has stood ready to make any sacrifice that she might be "mistress of the sea." The American nation was the orly one she ever feared in fair competition. We were rapidly gaining on her up to 1812, when her jealousy of our mighty progress on the sea was the cause of a war in which she gained nothing, but by which we established the rights claimed by us. There is not an instance where any nation has ever made such progress as we made between 1814 and 1840. In 1827, thirteen years after the war, our tonnage in the foreign trade increased over 300 per cent.,, while England, in the same time, increased only about 50 per cent. ; and no better illustration of England's alarm can be given than to quote the following editorial from the London Times of May, 1827 : *• It is not our habit to sound the tocsin on light occa- sions, but we conceive it- to be impossible to view the existing state of things in this country without more than apprehension and alarm. Twelve years of peace, and what is the situation of Great Britain ? The ship- ping interest, the cradle of our navy, is half ruined. Our commercial monopoly exists no longer ; and thousands of our manufacturers are starving or seeking redemption in distant lands. We have closed the Western Indies against America from feelings of commercial rivalry. Its active seamen have already engrossed an important branch of our carrying trade to the East Indies. Her starred flag is now conspicuous on every sea, and wil 1 soon defy our thunder." Things went from bad to worse in England. While ship -building was carried on byus^with ceaseless activity it decreased in England from 1,719 ships of 205,000 tons in 182G, to 1,039, of 103,031 tons in 1831. Our traders were now in every sea and fast monopolizLng the caiTying 33 trade. From 1827 to 1840 we kept rapidly gaining- on her as caniers on the ocean. Our ships outsailed those of England, and in 1855 we had in our ships tlie prefer- ence of cargo, because of better managed and faster ships. By purchasing ships from us, and admitting all material free of duty, England tried in vain to keep up with us. From this experience she found that she must build her own ships, and find her own material at home. Her iron industry was better developed than that of any other nation, and she commenced the building of iron ships. In 1840 England became convinced that she could not successfully compete with our fast clipper ships. Something had to be done to secure her in the control of the foreign markets, and to maintain her posi- tion as the first maritime nation of the world. She tried war, and it failed her. Then came a new policy. In 1840 she made a contract with the Cunard Steamship Co. for $413,000 per year ($16,000 per round trip) as compensation for carrying the English mails to America. In 1841 this amount was increased to $550,000 per annum, the company complaining that it did not pay them, and based their complaint upon the fierce opposition of the American clipper ships. In 1846 the sum was again increased to $705,666, which was equal to 25 per cent, per annum to this company on the entire capital invested. The shareholders were satisfied with 10 per cent on their investment, and the additional 15 per cent was used as a "fighting fund " to cut rates against the American clippers. In 1840, also, the Oriental Steamship Co. to the East Indies, China, and Japan was established, under a postal contract for a monthly service, and received the first year $1,121,500, which sum was increased in 1841 to $2,243,000 for a semi-monthly service. In 1850 the Royal Mail Steamship Co. established a postal service to the West Indies and Brazil under con- tract with the Government, and received therefor $1,350,- 000 per annum for ten years. The same year the Pacific Steam Navigation Co. established a line to the west coast of South America, under a contract with the Government, receiving for a monthly service $225,000 per annum. Now, add to this the $705,666 paid to the Cunard Co., and you find a sum total of $4,523,666 per annum paid for postal service on four lines to foreign countries. In addition to this amount, Brazil and other gov- ernments paid $1,500,000, making a grand total of 34 16,023,000, which was equal to 25 per cent, on the entire capital invested by Eng-laud in 1860 in steamships. THE AMERICAN CIVIL WAR. Gentlemen, this brings us down to the commencement of our civil war ^Ye then had 5.350,000 tons of ship- ping, worth S255,000,000. This immense wealth was principally created out of the profits of our ships engaged in the foreign trade. We were then the second carryiDg nation in the world, and rapidly gaining upon England. Her policy of subsidizing her steamships for the°twenty years just prior to our war prepared her to take advantage of the opporttmity offered by the with- drawal of our ships, and her steam tonnage increased 400 per cent, between 1S60 and 18»'^8. Our ships were driven from the ocean in the following manner : We had no navy with which to protect us, and our merchant marine was utilized for this purpose. No American sailing vessel could get a cargo withoiit a war risk on insurance, and this compelled American ship-owners to tie their ships to the docks. The vessels which were destroyed by the " Alabama and her class, in comparison to the number tied to the docks and idle, was very small, and if the true secret of those Con- federate cruisers and the work which they were intended to accomplish were known. I a.m sure it would be shown that no aid to the Confederacy was expected; only the destruction of our shipping was sought. Our commerce was driven from the sea. Three nations wanted it, England, France, and Germany. SHIPS FOR THE SHIP-BriLDERS. The old fact comes back again. The nation that cannot build ships cannot largely own them. England could build ships. France and Germany could not. England gained seven-eighths of what we lost. France and Ger- many gained the other one- eighth between them, and to enable them to gam this, England had to build the ships, and after 1860 the North Atlantic and South American trade was as much protected to England as was our coasting trade. Additional lines of steamers began to be required, and the English people began to cry out, ''If subsidies are to be given, let all English capital have a fair chance in open competition."' This competition was reduced to English capital, subject to the same rates of interest, taxation, and running ex- 35 penses, she having the advantage of all other nations in these items, but when she got the control of the busi- ness, and no other nation could compete, then came the reduction on account of mail contracts. ENGLAND STILL SUBSIDIZING. According to the official reports of the Post Office De- partment of Great Britain for the fiscal year ending March.31, 1880, England paid for ocean postal service to foreign countries $3,708,618. The South American Governments were always ready to meet England or any other country half way in the expense of mail service to the different countries, and in 1880 Brazil alone paid to English ship-owners for mail service the sum of $950,000 out of $1,850,(^00 ap- propriated for foreign mail service. Now it is safe to say that the other South American countries togethcL- with the United States paid an additional sum of at least $1,000,000 during the same year, and we have the enormous sum of $5,658,000 for one year paid to Eng- lish ship-owners. Annually this is nearly 6 per cent on $100,000,000, which would pay the interest in this country on sufficient capital required to put in commission two hundrtd 4,000- ton ships, or 800,000 tons of steam tonnage, giving em- ployment on the sea permanently to 23,500 men. England builds her ships, pays less for capital, pays less for wages to run them, less taxation, and has m.iny other advantages. 86 THE ACTION OF FRANCE AND GERMANY. The following, which I take from the official record of 1880, shows what France has been doing during the last ten years : P3 p r-2 . 014,045 05 ISTG 1,135,232 58 1877 1,227,299 82 18r8 I,a36,627 68 1879 1.462,267 97 1880 1,610,383 84 1881 1,588,823 87 Total $9,374,680 81 Expense of collecting same 70,000 00 Actual profit in 7 years .'$9,304,680 81 According to our present laws for the measurement of steam vessels, we measure the whole vessel, including officers' Oj^uarters. engine and boiler space, and coal bunkers, and charge tonnage fees on all; while all other nations measure only the net carrying capacity of the ship. This makes an extra charge against American ships in all parts of the Avorld of 33* per cent, tonnage dues more than the ships of any other nation. It affects the American ship during her time in service in the following manner : While loading at her wharf, 33^ per cent, more wharf- age. When in dry dock for repairs, 33^ per cent, more for dockage. When going through the Suez Canal, 33-i^ per cent, more for tonnage. While laying up at wharf , and not in service, 33* per cent, more expenses. It seems that the American .ship in foreign trade has been loaded down with all kinds of imnecessary burdens. Strange to say, the men who for fifteen years have been advocating slaps as Vic only TCinedij, have never seen any of these difficulties ; or, if they did, never suggested 41 their removal. The only difficulty they had ever dis- covered has been that of first cost, and that I have shown is the least. The American people are known the world over as the most practical people on earth, and who solve the most difficult problems, yet the world is surprised that we do not restore our flag- to the ocean again, for it only disappeared during our civil war. We have had two wars with the most powerful nation on earth, and which was a power on the sea. She meant to drive us there- from, but she did not succeed. The combined govern- ments of Europe could not drive us from the sea by means of war, but the policy of England during our own civil war did for her what her guns could not have done. If she will open-to her ledger and count the cost of her war with the U. S. in 1812 she will find millions of money charged up, together with the loss of thou- sands of lives, and nothing to her credit but defeat and loss. But a new policy, combined with shrewd diplo- macy and the outlay of a few millions each year during our war, did the work for her and gained for her a position on the ocean which she never could have gained by war. OUR FREE SHIPS. England's policy noio for us is Free Ships. Many of our best and purest public men believed this to be the best remedy, because it was made to appear so plausible on the surface. They did not investigate the matter fully. The following is a copy of the Free Ship Bill " which has made its appearance every year during the past fifteen years : ' ' Be it enacted^ etc. , That so many of the various provisions of title 48 of the Revised Statutes of the United States, entitled ' Regulation of Commerce and Navigation,' embraced in chapters one to nine of said title, and from section 4139 to 4305, both inclusive, as either prohibit or restrict citizens of the United States from purchasing ships built in other countries, to be used in the foreign carrying trade of the United States, or which impose taxes, burdens, or restrictions on such ships when owned by American citizens, which are not imposed on ships built in the United States, are hereby repealed ; and it shall be lawful hereafter for all citizens of the United States to buy ships built, in whole, or in part, in any foreign country, and have them registered as ships of the United States, and when so registered such ships so bought shall be entitled to all the rights, etc. " 42 Now the truth is, gentlemen, that free ships would not remove the diffiulties ^Yhich are in the wa}^ of our owning ships at all. The difficulties come after we own the ship : enormous taxation, cos^ of labor to run the ship after it is built, h-gh rate of interest on capital, are some of the difficulties with which we have to con- tend. English ship owners have immense capital in- vested, with ships in position. They are backed by a Government the policy of w^hich enables them to build ships, and they know that that Government wnl stand bv them in competition with the world, and to compete" with these ships without the support of our Government, would be quite as foolish as to raise capi- tal to attempt competition with one of our thoroughly organized and established trunk lines of railway, by the construction of a parallel line. As business increases the established railway will put on additional trains and so it is with the great steamship lines, which, backed by the strong arm of a Government, w^ill increase their tonnao-e leaving little chance for new competition. FoiMustauce, in 1865, when fhQ free-sMi:) cry was first raised in Congress by the advocates of a foreign inter- est these verv advocates could not have owned and run ships under the American flag if the ships had been given to them for nothing. For these reasons : Suppose five 5000 ton steamers had been given to them, value $5,000,000. The account at the end oi the year w^ould stand thus : Taxation American line on S5,000,000 at per cent. .. . • -Sl^jOQO Wages 600 men for five ships at $-2 per day . . . ; 4db,uuu Taxation and wages American line $563,000 Taxation English line, 1 per cent, on net earnings, ^ say 6 per cent o-q-^ Wages 600 men at $1.55 per day om'A^o Interest on $5,000,000 capital, 4 per cent Total English line 476,750 Or a saving in favor of English line of $86,250 Here the Americans were given literally /rc6 sM'ps and no account whatever taken of interest on capital, or tonnage dues, or the special w^ar tax then existing, yet there was an advantage against them of $SG,250 a year. Suppose then they had been obliged to turn the de- preciated greenbacks into gold, which was then at a premium of from 30 to 50— say $7,000,000 of greenbacks 43 to ^et what would take only $5,000,000 of gold from the English or French corporation, the account would stand : American line, running expenses and taxation ^|?n'om Interest on $5,000,000 at 7 per cent 6M,uw $913,000 Total cost English line, including capital, taxation and wages !_ L_ Difference in favor of English line annually $436,iJ50 Besides $2,000,000 premium on the $7,000,000 green- ^^Was it possible that this advocate represented the American merchant ? ^ ^ • ^ American capitalists would be likely to start m free sJiips on these terms -of competition, wouldn't they ? What must we think, then, of the honesty of the cry, ''Give us free ships and we shall be all right " ? Suppose, again, two English companies wanted to start a new line of five steamships each, buymg from the same builder at the same prices, and one of the lines puts its ships under our flag. The result would be that in the items of interest and taxation the hne run- ning under our flag would have a disadvantage of $296,000 to overcome annually. Could it raise capital for such a competition ? In all this not a word has been said about first cost, which is the only difficulty the free-ship advocate will ever see. He reminds me of the man who, boasting of his powerful sight, said he could see ^fly on a barn door two miles off, though he couldn't see the door. The free-sMjJ advocate can always see the fly of first cost, but never sees the door of taxation, wages and interest. Let us see, for a moment, how this item of first cost compares with those of taxation, interest and labor : Suppose five steamers in England costs ^K'?5n'nm Five steamers in United States, at 12 per cent, advance. . . 5,600,000 American line, 7 per cent, interest on extra $600,000, $42,500 a year, or less than 1 per cent, on the $5,000,000 capital. If this was the only difficulty he had to contend .with, I would trust the American ship-owner to take his share of the carrying trade. The ship on the sea is like the factory on the land. What American capitalist could buy a cheap English factory and run it on the American scale of high taxes, dear capital, and dear labor ? i • • -cThe free-ship advocate, therefore, is not working m the American interest when he forever puts forward the little difficulty of first cost and keeps out of sight the great difficulties that prevent us from owning ships and doing our share of the foreign carrying trade. He does not see that if the $5,000,000 for ships are spent at home, 90 per cent, of it goes to home labor ; while by his method of saving 12 per cent, all that capital would be pent to feed foreign workingmen and support a foreign Government, leaving our working men "idle and our natural resources undeveloped. But does the free-ship advocate say he has recognized other difficulties besides first cost ? I answer, he may have recognized them in his speeches ; but why does he always bring in a free-ship bill, and never bring in a bill to remove the real difficulties which I have pointed out ? His actions are all one way— and that way is towards England, not his own land. He has always two remedies, free ships and free ma- terial. We build iron ships at home, as cheap as any country in the world, except England. Should this free ship bill pass, England would be the only nation which could sell us the ships or material. Shall we depend upon her, our great rival, to furnish us, and enter into competitiom with her, and if we do, how can we expect to do as well even as France or Germany, who have had for thirty years the same privileges ? FRENCH BOUNTIES. Now, Mr. Chairman and gentlemen of the Committee, let me 'ask your attention to the provisions of the new French law granting bounties to ships, which are as follows; There will be paid for all steam and sailmg vessels launched after passage of this bill, excepting fishing vessels, yachts and steamers now receiving a subsidy, as follows : ''Thirty cents per ton for every mile run, to be re- duced each year as follows : cents per ton for wooden vessels. 11^ " " " composite vessels. 1 " cent " iron vessels. The vessels to be used by the Government in case of war ; and the above premium to be increased fifteen per cent', where designs are submitted to and approved by the Navy Department. " Where materials are imported for the construction of vessels, there will be allowed to ship-buUders, in place of the duties paid upon materials, 45 For every registered ton of iron or steel. For wooden > essels of over 200 tons For composite vessels For wooden vessels under 200 tons $12 00 . 4 00 . 8 00 . 2 00 For all the pumps, machinery, etc., required, $2.40 for every 220 pounds. All vessels transformed to increased tonnage after the passage of this bill will be allowed the same premium as for new vessels on the increased ton- nage.'' To give yoa a practical illustration of this new French bounty law, I will apply it to a 3,000 ton iron ship. The bounty would be: — On building : Weight of iron in hull, 1,800 tons, at $12 $21,600 Weight of machinery, 500 tons, at $24.43 12,615 Then there is allowed thirty cents per ton for every 1,000 miles run, after being put in service, for first year, diminishing one cent per mile each year thereafter. Presuming the above 3,000 ton steamer makes ten trips from Havre to New York per annum, or 60,000 miles ; this gives for first year's service, as follows : 3,000 tons, at 30 cents, = $900 x 60 = $54,000 And second year's service 52,000 This will expire entirely at the end of thirty years. Adding the bounty and the allowance per mile, the law would grant the 3,000 ton ship the first year $89,015. The French Government for this requires in return the carrying of its mails, and the right to use the ships in case of war, taking them at a fair valuation. Though this law seems an expensive one, yet it furnishes France with a cheap navy, and the best it ever had. This law met with the severest criticism from the English press while it was under discussion in France, and it is said that the English Ambassador in France wrote home to know if it did not conflict with the treaty between France and England. And now, since the law could not be defeated, English capital is going over to France to build ships there Under this law France, in seven years, will be able to hold the same control over the carrying trade of South America and the Pacific that England does on the North Atlantic. This France will be doing while we are wasting our time discussing free ships " and subsidy, and paying nothing for carrying the mails ; and the result, if we allow that to be done, will be that we will be left with our coasting trade, and with $34,215 46 nothing else. If we allow the present chance to put American ships into the South American carrying trade to slip away from us, it will not be left open to us long. Suppose that this law brought into use under the French flag 100 3,000 ton ships. To keep those ships in use for 30 years the French Government would pay, on an average, for 30 years about $2,500,000, per year. Those ships would employ under the law ten thousand officers, sailors, and engineers, and those ships would make a navy, as far as ships are concerned, superior to our present navy. France understands that this law is a law of great economy in the matter of building up her navy, and besides, these ships carry the French mails to all parts of the world. The price of mail service deducted from the amount paid for these ships reduces the sum to ^ a very low figure. Besides this, the ships constructed in France make an expenditure of $50,000,000 of which 90 per cent, is paid out for labor to the French working- man in developing the industries of France. Also, it gives employment to 10,000 sailors during the life of the ship, and the ship^s gross earning each year 40 per cent, of the original cost, mostly to be spent in France. Sam this all up, and you will find that it is sowing seed which will produce a rich harvest. I ask you, gentlemen, how American capital can be found to compete on the ocean, in the carrying trade, with French capital. IN CONCLUSION. These are the arguments that I have to present for the consideration of this committee, and T hope they will be carefully considered. We have all the material for ship building, the iron, the coal, and the wood ; and we have skillful workmen and suitable machinery. Will Congress now do its duty ? Will it enable our ship- owners to compete with the ship-owners of other nations, and thus secure us in the possession of a national marine ? There can be but one answer if we wi-h to preserve our interest in the sea. But what ever is done let it bo done with a will, and in no half hearted and doubtful spirit. 47 • EDilaiil's Policy wto War FaiM. THE NEW POLICY THAT SECUKED THE OCEAN C ARRYINd TRADE TO GREAT BRITAIN. • Protection to her own Steamship Lines. '<-0-^»-p' Assertions of Hon. David A. Wells and other Opponents of a Success- ful American Marine Refuted. ^ •go » Fads aialist Misrajresentatlons, -♦^♦^♦^•^ Mr. David A. Wells and others, opponents of a success- ful American marine, denies that England has pursued and is pursuing- a policy of subsidy, and that by such a policy she has built up and maintained her commercial supremacy. Will he deny that her policy has been at all times to control the ocean carrying trade? Her statesmen early recognized the fact that her very existence as a great nation depended upon her position on the sea. Her war with us in 1812 was nothing but a war of jeal usy against us as her dangerous rival in the ocean carrying busmess. When peace came our rivalry was only stronger than ever, and in spite of every means used to check it, our growth in tonnage engaged in the foreign trade increased 300 per cent, from 1814 to 1827, while that of England increased only about 50 per cent. The Englishmen were alarmed, and the London Times, in an editorial of May, 1827, said : " It is not our habit to sound the tocsin on light occa- 48 sions, but we conceive it to be impossible to view tbe existing state of things in this -country without more than apprehension and alarm. Twelve years of peace, and what is the situation of Great Britain? The ship- ping interest, the cradle of our Navy, is half ruined. Our commercial monopoly exists no longer ; and thou- sands of our manufacturers are starving or seeking redemption in distant lands. We have closed the Western Indies against America from feelings of com- mercial rivalry. Its active seamen have already engrossed an important branch of our carrying trade to the East Indies. Her starred flag is now conspicuous on every sea, and will soon defy our thunder." ENGLAND'S POLICY OF SUBSIDY. From 1827 to 1840, England's carrying trade went from bad to worse. In 1837 she made a mail contract, and began that policy of subsidy, straight-out subsidy, which Mr. Wells flatly denies. Samuel Cunard offered, in 1840, to build a line of mail steamships for the North Atlantic, and his offer was at once accepted. In 1840 he had four 1,200 ton wooden sidewheel steamers, 228 feet long over all, 34 feet beam, 28 feet deep-paddle-wheels, and beam engines. The names of the four ships were Columbia, Britannia, Acadia, and Caledonia. Their speed was nine knots in favorable circumstances. It would not cost to build them more than $200,000 each, making a total cost of $800,000 on these vessels ; yet Mr. Cunard got his contract of $413,000 the first year, and this was increased to $550,000 the next year, or 70 per cent, per annum on the whole cost of the ships. This was a subsidy, pure and simple, given to Mr. Cunard to enable him to establish and mamtain his Ime, and increased that he might ran his line not only with- out loss but at a profit. Without it, does any one be- lieve the line would have ever been started. This liberal subsidy was increased to $705,006 in 1846, when two more ships were put on, and still remaining at 70 per cent, on the whole capital invested. This subsidy was continued fifteen years, and when our Government withdrew its support from the Collins line the English Government continued its support to the Cunard. We also, in the ten years from 1860 to 1870, actually paid $3,750,000 to the English line in addition to the subsidy it received at home. 49 WHAT ENGLAND HAS PAID FOR SUBSIDY. The year of 1840 was the year of England's greatest alarm about her position on the sea, for she saw her power there passing away. That year she gave to the Oriental Steamship Company a contract for a monthly service to China and Japan for $1,121,500, and increased this in the next year to $2,248,000 for a semi-monthly service. The capital stock of the company at that time was only $7,000,000, and their contract was 30 per cent, on that. Other great lines were subsequently established by the same means— the Royal Mail Steamship Company, to the West Indies and Brazil, and the Pacific Steam Navigation Company, to the west coast of South America — so that the simple fact is that in 1850 England was paying mail subsidies amounting annually to $4,523,6^16 — or over 30 per cent, on the whole capital invested in her steamship lines, all of which were built up and es ablished by subsidy, held out as an inducement to capital. Since 1840, England has paid out in mail sub- sidies over $200,000,000, and received almost a quarter as much more from this and other nations, and as a re- ward is the great ocean carrying nation of the world. PROOF OP ENGLAND'S SUBSIDIZING. The falsity of the assertions that England never paid subsidies to the steamship lines, never paid anything but a fair compensation for mail service, never paid any- thing to aid a line to start, to continue running, or to build up commerce, is proven by the postal contracts of the Government with such. These oflBcial documents tell indisputably the story. The one, for example, with the Peninsular and Oriental Company made with them in 1853 for an annual subsidy of $2,500,000 was to expire January 1, 1867. February 27, 1866, a new contract was made. Whether the contract was made for any other purpose than that of simply carrying the mails may be judged from, the fact that under the contract the com- pany agreed to submit its plans to the Government Com- missioners, and to construct the hatchways and other parts of its ships as might be necessary to the carrying and firing of a heavy armament. That made the vessels immediately available for naval purposes and for de- fense, and they were at the Government's disposal in case of need, and were used in the Crimean war in a way that opened the eyes of the French to the great import- 50 ance of the merchant marine manned and equipped and at the Government's disposal. . . With the same company a new contract was made m 1870 In ' ' Articles of Agreement made this 6th day ot . Anffust 1870, between the Right Hon. Spencer Compton Cavendish, commonly called Marquis of Hartington, her Maiestys Postmaster-General, and the Peninsular and Oriental Steam Navigation Company," I find that tor carrviD^ the mails at a speed not exceedmg ten knots an hour '^he Postmaster-General doth hereby covenant that there shall be paid to the company (out of sucnaids or supplies as may from time to time be provided and appropriated by Parliament for that purpose) the sum of £450,000 ($2,250,000) per annum." And m section 4b the contract of 1867 is declared annulled, ';all claims of the company in respect to the suhsidij therein mentioned having been fully satisfied by the payment of a subsidy after the rate of £500,000 ^5^^'^^?) ^To^- if a report of the Postmaster-General, dated July 20, Ib/U, I find this significant passage : " ^ -, -.-u 4-1,^ ''By the terms of the contract concluded with the Peninsular and Oriental Steam Navigation Company op the 19th of November, 1867, the subsidy to be paid the fompany issetdown at ^^00,000 ($2 000,000) a yea^^^ with a stipulation, on the one hand, that whenever the annual income of the company from all sources does not admit of the payment of a dividend of 8 per cent, on the caStal employed the subsidy shall be increased by so mufhis^^^^ of £100,000 ($500,000)-as IS - required to make up such a dividend ; and, on the othei, that whenever the income is sufficient to allow a divi- dend exceeding 8 per cent, to be declared the company shall pay to the Postmaster-General one-fourth of the excess." NOT ONLY SUBSIDY BUT DIVIDEND. Here is not only a subsidy, but a government guarantee of an 8 per cent, dividend to the company's stockholder. What has Mr. Wells to say to this ? This isn t ^ a sub- sidv— Oh no ! This is merely fair pay for carrying the mails. This has nothing to do with the maintenance of the company -Oh, no ! But the company estimated that " the receipts from the passengers and cargo must tor a long lime to come, be greatly belo^y the expendituie absolutely necessary for the maintenance of the service against the yet more highly subsidized French line ; and the Government promptly raised the annual subsidy back 51 to £450,000 ($2,250,000). What has Mr. Wells to Say to these official facts ? And I ask him how the Ameri- can Pacific Mail Line could compete or increase its fleet against this line, which was guaranteed 8 per cent, by the English Government, while our Government com- pelled the Pacific Mail to carry the mail against its will for the postage, which was a mere nothing. The case of the English Government's contract with the Royal Mail Steam Packet Company to Brazil and the West Indies is still more striking. That contract jjuaranteed subsidies sufficient to yield 8 per cent, dividend on a capital of £900,000 ($4,500,000). An extension of the period of the contract was asked for, in consequence of serious loss to the company by hurricane, in order to enable it to get on its legs again. According to Mr. Wells' assertion that England never paid a dollar to keep an English line alive, this request ought to have been rejected. In fact, the Government granted it. The fact was frankly admitted by the company's secre- tary in 1867 that during the American war and before the competition of the highly subsidized French com- pany, this company earned sufficient to yield a satis- factory dividend to its shareholders, but the case has been very different during the last two years. ' ' THE SCUDAMORE REPORT ON THE NECESSITY OF BSIDY. An investigation, ordered by the English Government, was made by Mr. Scudamore, recognized as the most competent man in England in such matters, and he reported, among other things, as follows : First — That the circumstances and position of the Royal Mail resemble in many striking particulars those of the Peninsular and Oriental Company, and that both are conducted upon sound and well recognized principles. Second - That with both companies a subsidy is abso- lutely necessary to the maintenance of the service required from them, and that in the case of both com- panies their ordinary revenue has in no case sufficed to meet, and is now very much below, the expenses of the services they have to perform. J7^^>^?— That the Royal Mail Company has held con- tracts for the conveyance of the mails for periods of 27 and 18 years, or a subsidized existence equivalent to 45 years. That it could have borne an abatement of £60,000 ($300,000) from its postal subsidies in 1862 and yet have paid a dividend of more than 8 percent. That 62 in 1864 they did suffer an abatement of $800,000 but still paid over 19 per cent., with a further dividend ot 5 per cent, from their insurance fund. [Note how long- it took this infant company to get its growth and stand alone, though having all the advantages of cheap capital, cheap labor, and taxation]. ^ ^qpp jTourth— That this prosperity continued until l»bb, when it came to an abrupt close ; that in 1867 the com- pany only iust made both ends meet, and that the saving of $300 OOU per annum to the English Government from 1864 to 1867, could not have been effected, and the rapidity frequency and eflaciency of the communication been at the same time maintained, if the American war had not thrown into the hands of the company a new and very hicrative trade. [Thus subsidy and our war did the work of driving us from the sea.] jPifth—Thsit the first question is whether it is con- sidered necessary that the communication between England and the West Indies, the Spanish Main, Central and South America, the Brazils, and the River Plate should be as frequent, as rapid, and as secure as hereto- fore [As an argument on this point he shows that England's trade with these countries bad grown from £39,850,911 in 1862 to £52,495,496 in 1867. And he adds • ''I assume that in whatever way it is thought right to maintain communication with those countries the service will be direct, and not, as it was at one time proposed to be, by way of New York. ^ I am led to as- sume the abandonment of the proposition for a service via New York by a perusal of the memorials w;hich the department received in 1862 and 1863 agamst the adoption of that route from the representatives , of the entire mercantile community of the kingdom. The memorialists all took the same ground, that the trans- mission of the mails via a foreign port, when they could be sent direct, was objectionable m principle, j Sixth— That the withdrawal of the subsidy from the Royal Mail Company, if it did not altogether breaK up the company, must entirely alter the character of their operations and lead almost immediately to a deteriomtion of the quality of their fleet ; that there can be no doubt that during the American war the Koyal Mail Company derived a special advantage from their position as con- tractors with the British Government, and it is a sound proposition that the subsidy for such services as theirs should be such as, taken together with the returns Iron ordinary traffic, will yield a moderate dividend. 53 This report was accepted, and the contract extended as asked. Now, I ask Mr. Wells what would have been the result if it had not been extended ? And I would like to have him say once more that England never paid a subsidy, nor paid money for any purpose aside from simply securing the carriage of her mails; where do these official contracts and reports place the "historic lie ? " And I would like to have those who are content to have our mails go to Brazil via England ponder on the meaning of those remonstrances of the whole mercantile community of England when it was pro- posed to send a mail line via this country. The English merchants are not so generous as Mr. Wells and the Evening Post, to look out for foreigners first and for their own interests last. MR. wells' construction OP SUBSIDY. I will have no quibble with Mr. Wells about the word '* subsidy." He says England paid mail compensa- tion. " So she did, and, as I have proved conclusively, paid sufficient compensation to insure the establishment and maintenance of that first-class, rapid, frequent, and efficient communication, both mail and passenger and freight, which is the pioneer and life of commerce, and even went so far as to guarantee to capital a profit. Call it subsidy or what you will, that is more than I have ever asked or prosposed. I have advocated and do ad- vocate a policy of fair mail compensation that shall se- cure us the communication with new markets which is indispensable to our national growth and prosperity and help us regain the place which belongs to us as a great ocean carrying and maritime nation. Mr. Wells seems to limit the word "subsidy" to extraordinary " payments. As he does not consider the $2,500,000 a year paid by England to the Peninsular and Oriental Company an extraordinary payment, I am sure T do not know what would seem extraordinary " to him. But this I do know : That England paid the Peninsular and Oriental Company $2.50 per mile, the Cunavd Company $2.80 per mile, and the West Indian Company $3.07 per mile, for carryiug the mails; while the highest contract ever asked for by the line with which I was identified was 75 cents per mile, or only one half the .amount paid to the Peninsular and Orien- tal, and one third of that paid to the West Indian Im^f WJiich was the more ' ' e:5traordinary in thi§ 54 case ^c*^.. ; And will Mr. AVells explain how it is that what is not subsidy when England does it, becomes " sub- sidy " the moment it is proposed here ? Will he tell us how it happens that what he sees white in England looks so black to him in America ? Is he one of those unfortunate people who are so far-sighted that they can never see anything correctly that is near by. A LAW THAT TAKES POSSESSION OF CITIZEN'S PHOPERTY WITHOUT COMPENSATION. Then it should be noted that while my line was refused f dir compensation, I was compelled to carry the maUs under the following unjust law : ' , ^ "United States Statutes, section 976: The master of any vessel of the United States, bound from any port therein to any foreign port, or from any foreign port to any port in the United States, shall, before clearance, receive on board and securely convey all such mails as the Post Office Department, or any diplomatic or consu- lar agent abroad shall offer, and he shall promptly de- liver the same at the port of destination to the proper officer for which he shall receive two cents for every letter so delivered, and upon the entry of . every such vessel returning from any foreign port the master there- of shall make oath that he has promptly delivered all the mail placed on board said vessel before clearance from the United States, and if he fail to make such oath the vessel shall not be entitled to the privileges of a vessel of the United States." CONTRASTS. While the Peninsular and Oriental Company was get- ting from England $2.50 per mile for carrying her mails five American lines were compelled under the law just quoted to carry the United States mails 1,181,309 miles, and to places where we have a trade of $200,000,000 an- nually, at the rate of 2i cents per mile, in many in- stances actually suffering loss in doing this compulsory service Does Mr. Wells consider this a just law or fair compensation ? Why not treat the railroads in same way then, in carrying our mails on the land ^ Will Mr. Wells compare with this the treatment accorded the late American line to Brazil by our Government, when it asked no guarantee, only $100,000 a year for carrying the mails and opening up a new market from which we had shut ourselves out for lack of Qommunication, while 55 England had reaped there a rich commercial harvest. Yet the Brazilian line was trying to build up a trade tor this country against this English subsidized line. It is to be not-d that England's peace pohcy of sub- sidy was pursued with as much vigor as her war pohcy had been to drive us off the ocean, and while England was actively, but silently, at work we allowed it to go on Mr Wells and others like him being engaged m blinding the eyes of our people to the true situation If England had only kept up a war pohcy we should have met her every time in that. FRANCE ALSO SUBSIDIZING. Mr Wells and his fellow freetraders say that ''free ships " is all we want to revive our carrying trade. Does he know that France is to-day subsidizing to a greater extent than England ? Yet France has for 80 years en- ioyed that privilege of buying free ships from England which is forever prated about as the remedy tor our dit- ficulties. France has found, however, that she cannot run these ships against England's subsidized ships. The French Government is now paying five millions a year m subsidies for mail service. The ships now running to New York receives $500,000 per annum. Besides, France has learned at last that the only way to be a great ship- owning nation is to be a ship-building nation, and has passed a general law offering a bounty for every ship built in France that run£ in the foreign trade. The whole meaning of this policy of subsidizing their ships on the ocean is a practical plan of protection to those great national interests, and that fact is well understood both in England and France. Does not England supply her own people with ships and as cheap as she would supply a foreigner ? But it she has to subsidize her own ships, in addition to having all her advantages of cheap capital and labor and taxa- tion how can we expect to succeed in the competition if we do not pursue a like policy ? And it is worthy of remark that, while England is free trade on the land, the facts show that she was and is a most radical pro- tectionist on the water, giving her people greater Protec- tion and better facilities than any other nation. And now that she possesses the trade and advantages, she can well afford to cry out about making it all free, ihe trick is not a new one with her. 56 ENGLAND'S PROTECTION TO HER STEAMSHIP LINES. And though England adopted free trade in the broadest manner where it served her purpose, yet to her steam- ship lines she gave the most radical protection. And as Mr. Sherman Crawford said in his great speech, when the question was before Parliament of renewing the mail contract with the Peninsular and Oriental Company, *' to refuse to renew the subsidy to English lines, and to let them compete with the highly-subsidized French lines, would be free trade gone mad." To show that the English Government did not propose to follow the free trade policy to that extent, I will give a few further facts concerning the Peninsular aud Oriental Company's service. The contract with it was to expire in 1868, and under the terms the Government was to give the company notice as to renewal a year before the expiration. Notice was given accordingly in 1867. (Mark that from 1840 to 1867 this line was receiving a subsidy, at first of 30 per cent. , afterward of 15 per cent, on its capital stock.) In consequence of our civil war, our shipping had been driven from the ocean, and we were no longer feared as a rival there. That fact being appreciated, the English neople themselves began to cry out that, as we had been driven off the ocean by their policy of subsidy and our civil war, their purpose was accomplished, and it was time to stop, as to continue would onlv be to subsidize one Englishman's interest against another. Quite an unfriendly feeling grew up against the heavily-subsidized lines, and the Government decided to open the Oriental Contract for competition, not only to all English companies, as formerly, but to the ships of other nations. I will give ycu some extracts from the debate on that subject in Parliament, and from the English pjess, to show how the proposition was re- garded, and the feelings of the English people about allowing foreigners to carry their mails. HOW PARLIAMENT ENCOURAGED FOREIGNERS. Mr. Crawford, M. P., speaking against the Govern- ment proposal, said, in opening th debate in Parliament, that ''wherever postal communication has been ex- tended, there commerce has invariably been attracted ; in fact, the conveyance of the mails has proved a most efficient agency for increasing our trade in all parts of the world?' This is a point worth noting, and is one that I have always maintained. 57 Mr. Wells asks, in his letter already mmed, What becomes of the assertion that Great Britain has achieved and still maintains her mercantile supremacy in the carrying- trade of the ocean, through a system of pay- ments for mail and other service, extraordinary in their nature, and disproportionate to the value of the work performed, and with some other intent than the osten- sible object for which the payments are made ? " Well, let Mr. Crawford answer Mr. Wells. He ought to be good authority on his own country's affairs, and he says : " I, for one, hold that there are considerations to be taken into account in this matter, which are wholly apart from the question of the profit and loss arising upon the accounts of the Post Office. This difference is not considerable ; but whatever it is, that difference represents the whole cost, to this country, of the means by which not only the commercial, but the social and political connection between this country and the world is kept up." SIR CHARLES WOOD ON VALUE OF POSTAL COMMUNI- CATIONS. Sir Charles Wood, who is an authority second to none, wrote to the Secretary of the Post Office in October, 1867 : It has been the perception of the bearing of in- creased postal communication on the wealth and progress of the country, that has induced statesmen of late years to consent to fiscal sacrifices for the purpose of obtain- ing it. There can be no doubt that increased postal communication implies increasing relations, increased commerce, increased investment of English capital, and from all these sources the wealth and prosperity of Eng- land are greatly increased." I commend those views to the theorists who make light of the value of postal communication as a neces- sity to the building up of commerce. Do they not show that England did pay subsidies for some further purpose than simply the carrying of the mails ? But speaking of the proposal to afford to foreign companies the power of competing, 58 MR. CRAWFORD THUS VIGOROUSLY PROTESTED AGAINST IT : " Now, what I desire to do on this occasion, is to pro- test in the name of the interest of the country and of commerce, and in justice to our own companies, against the ships of the Messageries Imperiales, or of any other foreign company, being employed in the conveyance of our mails. (Loud cheers from all parts, of the house.) You may carry the prindpre of economy too far. (Hear, hear.) Such a course of proceeding would be free trade gonemady (Renewed cheers.) " I am convinced that the subject has not been suffi- ciently considered. For what would be the position of this country in the event of a war or any interruption of existing relations taking place ? Supposing the Messa- geries Imperiales or any other foreign company be awarded the contracts for our mail service, w^hat would be the position of our commerce in the event of our being unfortunately engaged in hostilities with the country with whose people the contract has been entered into ? or even in the event of that countrv being at war with some other ? (Hear,, Hear. ") FREE TRADERS GONE MAD. • I want to call special attention to the above sound suggestions, because it has been asserted here that it makes no difference at all whether we carry our own mails or have foreigners carry them, so that they- are carried most cheaply. That certainly was not England's view^ or policy. And I would like to ask any sensible man this question. If England had lost her carrying and merchant marine under such circumstances as we did, through our war, and if it had been declared that England would be better off to let France carry her n\ails, and to buy w^hat few^ ships she could get from France instead of securing the means to build them at home ; if, moreover, when a proposal was made to estab- lish steamship lines to carry the mails to new ports which needed to be opened up to commerce and give to Enghsh producers new markets, a great outcry was made about "Subsidy"; if, in short, any Englishman had talked so unpatriotically and absurdly and mis- represented things so baldly as Mr. Wells, the Evening Post and other of our newspaper theorists have done, would not Mr. Crawford, yes, and even Mr. Colden himself have said that they were free-traders gone 59 THE VIGILANCE OF ENGLAND. Now on another point of national importance, read what Mr. Crawford says in Parliament while the subject was under discussion. '*I am of opinion that there is a question of grave national policy involved in our maintaining these great lines. And the French seeing this, it has been a part of their policy for years past to construct a commercial marine of their own, propelled by steam, which shall enable them to compete with the large companies of this country. The French have seen what the Peuinsular and Oriental Company's ships did in the Crimean war. They then carried upwards of 60,000 men from this country," 2,000 officers, and between 11,000 and 12,000 horses. We know, also, what the Peninsular and Oriental Company did at the time* of the Indian mutiny. Where should we have been if its vessels had not been in existence then to take out our troops and military stores f (Hear, Hear). We know, too, what was done by another company in the Trent" afPair. We know how 10,000 men were sent out to Canada by the Cunard line of steamers and other vessels, almost at a day's notice. OUR STJqSSIDIES TO FOREIGN LINES CREATING A NAVY TO BE USED AGAINST US. Yes, in America we know that, and we know, too, by the official statistics in the Post-Office Department ^at Washington, that during those years from 1860 to 1870, the United States Government was nursing this foreign line to strike back at our life by paying over $3,798,000 to it for carrying our mails. It is strange that Mr. Wells and the Evening Post never notice facts like this, which show how fine a policy it is to be dependent upon foreign nations. We were virtually paying a subsidy to the Cunard line. And to pay our money to foreigners for carrying our mails is nothing less than to raise up a navy to be turned sometime against ourselves. I say what we want to do instead is to raise up an auxiliary navy of our own. POLITICAL INSANITY. But to conclude with Mr. Crawford, he said strongly : ' ' Now I enter my protest against any act on the part of Her Majesty's Government which shall saddle this country witli a contract either with the Messageries Imperxale^ 60 or any other foreign company (loud and general cheer- ing). I hold that puch a couise would be contrary to public policy ; that it would be unfair and unjust to the Peninsular and Orient;. 1 Company and that it would be , an act of 'political insaniti/ for us to put such a weapon into the hands of any foreign Government whatever ; and more especially so, bearing in mind that the w^eapon thus put into their hands has been first taken out of our own. (Loud cheers. ) I call that a sound and' national view, and a pretty conclusive auswer to the question, whether England had any object in view save simply the carrying of her mails at the lowest figure. We did not accept this view when between 186 M8T0, as I have shown, we paid from three to four millions to place such a weapon in English hands and had it turned against us by the sending over of war ships to Canada to menace us in the Trent affair. THE PENINSULAR COMPANY SUSTAINED BY SUBSIDY. Mr. Wells says the company was not maintained by its subsidy. Well, I find in Herapath's Railway Journal of August 8, 1867, the statement that the captital stock of the Peninsular and Oriental fell from £3,500,000 to £2,000,000 or £1,500,000 (17,500,000); and this com- ment : ' ' The cause of this immense depreciation is no doubt the fear that the company will lose the mail contract, and that it will be given to the French company in order to save a little money. We, and we think the country at large, would be horrified if the carriage of our mails were handed over to the French. We should almost as much desire tbe French to undertake our military ser- vice as our postal. People who imagine that the ques- tion at issue concerns only the private int rests of the Peninsular and Oriental shareholders make a great mis- take. That great company's vessels the pride of the ocean. Should the British Government cripple the Peninsular and Oriental by taking away the mail service from them ? Shall they iDe compelled to sell this mag- niffcient fleet of seventy ships, pull down the English and hoist the French flag ? Shall 3.000 English officers and sailors leave these ships and be replaced by an equal number of French? Shall this country discard this powerful aid to our navy and thus build up a French novy ? Of course, the country could not grumble if this were done, for this Government woulcl be the cause 61 While, as Dr. Wells says, the dividend paid by the Company was only 3 per cent. , the Government was paying them over 15 per cent. If the Government had not decided to sustain the English line against the French, who were the lowest bidders, does Mr. Wells think the Peninsular and Oriental, with its 70 ships, would be in existence to-day ? Would not the French line, already heavily subsidized by its own Government, have driven the other from the sea, if it had only ob- tained the English subsidy ? Certainly it would, just as the English 1 ne drove the Collins line off when our Government refused to sustain it. France and England were engaged in a fight of sub- sidy against subsidy, while we alone starved the Collins line. Mr. Collins could not compete with Mr. Cunard and the English treasury, and down came our flag. The English Government sustained Mr. Cunard and honored him with knighthood, while Mr. Collins was ruined m his effort to sustain our steam marine on the ocean. SUBSIDY A FAMILIAR WORD IN ENGLAND. A word more to show that when Mr. Wells says England did not pursue a policy of subsidy he not only misrepresents Mr. Higgins and the English statesmen, but the English press. In the London Daily News of August 14, 1864, an editorial on the Peninsular and Oriental Company, which Mr. Wells declares was not and is not subsidized, I read: " To abandon the present system of subsidizing a pri- vate company would be to abandon those advantages which experience has proved to attend it ; to employ a foreign company exclusively would be practically to transfer the lines of communication into hands whicli might some day prove hostile, and that without a mo- ment's warning." That means sound sense and statesmanship as well as subsidy. And to caution Mr. Wells before he again asserts that whoever says England pursued a policy of subsidy is thereby guilty of the historic lie," I commend to him this from the London Morning Star, of August 3, 1867 : "It cannot be forgotten, however, that the system which has prevailed hitherto in this country of suhsidiz- ing powerful companies, with the view of promoting speedy trans-oceanic communication, has been produc- tive of the greatest possible benefits to commerce and served many other patriotic ends. We have seen a trade 62 of colossal magnitude grow up between this country and foreign nations. No one can doubt that the rapid and certain means of communication provided by the Penin- sular and Oriental Company have most powerfully aided the growth of that commerce, although the Company in its turn may have participated in the prosperity. We are not disposed to go into the further questions as to the packet services being nurseries for the navy and naval auxiliaries. All our mercantile marine is necessa- rily, in some sense, a species of naval reserve. ... It is enough that England requires and must have the most powerful and swiftest mail steamers which can be pro- cured, and that to secure this benefit she is ready to pay a remvneratite 'price to the companies which come for- ward to do the work and to enable us to reach and con- trol foreign markets. This is another answer to Mr. Wells' assertion that England paid for mail service merely and only a fair compensation. It will be good reading also for those who say it makes no difference whether a nation does its own carrying or hires it done and runs the risk of foreign complication?, so long as it gets it done at the cheapest rate. The London Morning Post again says : In looking at this question we must not confine our- selves to a mere consideration of the postal require- ments, but we must remember that the possession of a splendid fleet of first-class steamers, the nursery of hardy seamen and the prestige of the British flag in foreign ports, is not to be lightly cast aside because adventitious aids to a foreign enterprise might enable as to show a most unwisely prized economy." It w^ould be worth a vast deal to this country if -we had a press that watched our interests in a like national spirit, instead of always looking out specially for a foreign interest. But now I hope I have proved enongh to settle this question about subsidy. It makes no difference whether the word is used in the sense of ordinary or extraordinary payments, or whether it is used at all. ^ The fact is sim- ply this : Great Britain built up her carrying trade and her commerce, as I said all along, by paying such liberal compensation to English steamship companies as enabled them profitably to carry her mails and thus to give regular and direct means of communication to her merchants and give to her producers the advantage of reaching new markets over the merchants of other nations. Her policy 63 was and is more radical than has ever been proposed or favored by me. And what I think there is just cause to complain of is the fact that Mr. Wells, the Evening Post, and that class of theorists who only own and mn ships and other enterprises on paper, consider as all right in England, the very thing — i. e. , fair pay for carrying the mails — that they declare to be all wrocg here, and do their best to misrepresent and malign as subsidy ; even calling it a subsidy for a special person, when they know well that in no instance, directly or indirectly, can they show as a fact that either myself or Mr. Higgins, or any one else friendly to the American shipping interest has ever asked for anything more than fair compensation for carrying the mails, and that the contract be adver- tised an,d the competition thrown open to all. All that has been asked is to apply the same rule to our ocean mail service that is applied to our land and coast service. And now will Mr. Wells acknovvledge that the English press and English statesmen knew they were advocating a plain, simple subsidy for other purposes than mail compensation; and if the " historic lie " has been told, it lies between Mr. Wells, the English press, and the majority of the English Parliament, for they voted the renewal of the Oriental subsidy, and refused, after inviting the French to bid, to give them the con- tract, though they were much lower. I ask Mr. Wells if the contract had been given to the French line would the Oriental line be in existence to-day ? I have shown how the English statesmen and press regarded a proposal to have their mails carried by for- eigners. Who will explain how it happens that these free trade and free ship theorists c-f our own country never see any hope for us in any proposition that would build up home industries and homft interests, never see any plan they can approve except a plan that will build up English industries and rnteres^ts ? How comes it that these men who are always advocating a policy that will, even if it helps us at all as they claim, yet helps England first by getting her to build our ships ? To my miud they are worse than free traders gone mad," and as little confidence is to bo placed in their professions as in their gratuitous giving of the " historic lie " to a man who dares to state a historic fact. That was all Mr. Higgins did ; and Mr. Higgins, who probably has had more to do with shipp ng and knows more about it than any other man in the country, cannot make such a statement of fact without being accu&e^cj. of 64 falsehood, and abused by those men who have no prac- tical knowledge of the subject whatever, and whose interest like their knowledge is all derived from foreign sources. Mr. Higgins has even been charged with being an agent of mine, because he happens to hold views similar to mine in some respects as to a proper Amer- ican national policy to regain our h)st place on the ocean. But Mr. Higgins' reputation will not suffer from such assaults. It is always the last resort, when a man cannot answer with arguments, to answer with aspersion and misrepresentation. But the truth prevails in the end. A MISREPRESENTATION CORRECTED. I have given the facts about subsidy as regarded- and legislated upon in England. The truth of my state- ments can be proved by anybody. Now, to a remark made by Mr. Wells personal to myself. In his letter published Feb. 19th, he says : "But now comes forward John Roach, and says to Congress and the country, ' If you will pay me an extra sum, sufficient to make good the loss which inevitably accrues in building and sailing ships under your laws and policy, and a profit besides, I will build and sail your ships and do some of your ocean carrying trade.'' Now, I challenge Mr. Wells, as a fair man, to prove these words. If he is informed on the subject he knows they are not true. I call upon him to produce any bill advocated by me that does not propose simply the pay- ment of a fair compensation for service actually ren- dered in carrying the United States mails, and to award a contract for a term of years for such service, throwing open the competition to all, and awarding the contract publicly to the lowest responsible bidder guaranteeing to furnish the service required, the ships, of course, to be American built and owned and run under aur laws and flag. As an honorable man he should either prove or retract such a statement. AMERICAN STATESMEN ON SUBSIDY. Just a word more, to place Mr. Wells and his fellow free trade professors and theorists (who build and own ships, and conduct great industries only on paper, and would make sad havoc with capital if it were placed in their hands to be practically used) between the upper and nether millstones of both English and American statesmanship. 65 WASHINGTON'S ANXIETY FOR OUR COMMERCE AND AGRICULTURE. President Washington said, in his second annual mes- sage : • ' I recommend to your serious reflection how far and in what mode it may be expedient to guard against embarrassments from these contingencies [danger to our goods carried in foreign ships by war] , by such encourage- ment to our own navigation as will render our commerce and agriculture less dependent on foreign bottoms which may fail us in the very moment most interesting to both of these great objects." JAMES Iv. POLK ON PANDERING TO BRITISH POWER. Mr. Polk, in debate in Congress upon a grant of subsidy to the Collins line said : ^' It is strange, sir, that men who are presumed to em- body the wisdom of the land, should have to be reminded that they are pandering to British poicer — that they are forgetting American interest, and losing sight of that greatness and grandeur which attaches to this American Government. I stand upo:i the floor of the American Congress and find men who are willing to measure our greatness by the circumference of a dollar — a dollar, sir— measure American prosperity, American greatness by a round dollar, and thus pander to British interests, to bow the pliant knee and say to the power that assailed as at Lexington, that flashed the first guns from Bunker Hill, that fought us upon sea and land in 1812, that has been jealous of our prosperity and greatness ever since — ' Good mother, won't you carry our mails for us ? V Why, sir, I scorn, I despise, this anti- American feeling and sentiment. The men who stand battling upon these principles are behind the age. They are be- hind the progress of their country, they know nothing of its power or its influence, and are contributing to a com- bination of foreign policy designed to overslaugh us. ' Never were there truer words, or fuller of foresight, and just such men as then fought for British interests find their allies and representatives to-day in Mr. vVells and his companions. Mr. Bayard, the father of the present Senator, said in 1852, while ADVOCATING JUSTICE TO THE COLLINS LINE : " I am willing to trust American pkill and industry in competition with any people on the globe, when they 66 staud nation to nation, without government interference. But if the treasuiy of i\ foreign nation is poured into the lap of individuals f^r the purpose of destroying the interests of my country, or for building up a commercial marine .-it the expense of the commerce and prosperity of the United States, I, for one, will count no cost in comitervailin:^- such governmental action on the part of Ciicat Britain or any foreign power. lb has been objected that these grants create a moriupoh\ * " If the argument be true, I ask you if ]b dues not apply to the transportation, of your mails by land. " Then the whole government action is a series of monopolies as regards the 'Post Office Service.' , , i. IIo ihon argued that ifc was not monopoly, but Aiiiericnu competition against British monopoly. Wi ! Tou adopt a policy w^hich will place the entire tra D spc i ion of 3' our mailsunder their (British ; control ; which Will put into their hands the transportation of pa.-^e:^^el < which will lay a tax on American citizens, for t-io rdvL'ii cement of British commerce, their freights, etc. ? h'-ic i may be the j-.idgment of the honorable LVnator, I ut it is not mine, and I trust it will not be that of the American Senate. - The mail -service in this and in all countries on land is a government duty, and with all great maritime nations which have the power to control that service on the ocean, it is as much a government duty, where there maritime interests are concerned, where their extensive commerce is concerned, as is on land the proper trans- portation of correspondence The mail-service with forc;ign countries, on any principle that I can appreciate, is as much a governmental duty, and demands as much the expenditure and the attention of the government as transportation of correspondence in the interior of the country.'' . Just this thing of placing our mails under British and foreign control has come to pass, and these views w^ere as prophetic as they are sound. They commend tliem- selves to all citizens ia and out of Congress, who love their own country first and best. LEWIS CASS ON PIlOTECTIO^■. Lewis Cass said in the Senate, on the same subject ; Well, sir, it is a question of protection— of high and important and holy projection— in the best sense of the 67 term; the protection of our country, of our expatriated seamen, of our commerce, of our interests, of our honor, of our soil of all that gives dignity and character to na- tions ; protection against defeat, disgrace, and dishonor on the sea. This kind of protection to our commerce is as effectual as the protection afforded by expensive naval armaments." A CONGRESSIONAL COMMITTEE FAVORING SUBSIDIES. A Congressional Select Committee on the cause of the reduction of American tonnage, reported in 1871 , recom- mending as a remedy the ''Granting of government aid by way of postages on mails and by subsidies, so as to insure the establishment of American ocean lines of steamers to foreign- ports, thus securing to our people the profits of the trade so created," and saying that ''no people on earth, as well as those of the United States, understand so fully the vast wealth developed and created by railroad lines. ' The analogy is perfect as to ocean routes. They are the rail- oads of the. ocean, making the world pay tribute to us, and creating vast markets for our products and manufactures. We give millions to the one ; shall we hesitate at a few thousands for the other ? " The man nowadays, who believes as these men be- lieved, is hounded .as a subsidy beggar, but right will prevail when the question is understood. ' EX- SECRETARY EVARTS ON^ SUBSIDY POLICY. Ex-Secretary Evarts said, in an address to an export convention, ''that thire was great prejudice against the word subsidy, but that without the judicious use of such a policy, "with our natural products and manufacturing facilities weVere becoming the laughing stock of other nations." PROVEN FACTS 'DS. UNCONFIRMED ASSERTIONS. These examples must suffice. Where does Mr. Weil;- stand between these statesmen of England and our own land? Against Mr. Wells' repeated assertion that the English Ciovernment has not and does not pay subsidier? I have placed the English official contracts, the declara- tions of English statesmen, and the testimony of the 68 English press, that she has and does pay them, and that the English people understand, appreciate, and approve the policy, having seen its glorious results in winning peacefully |or England what she never could have won by war in commerce and carrying. OUR OWN TEOPLE WILL, I am convinced, likewise approve it as soon as they come to understand it and appreciate what it has done for England; that it is not the wrong and wasteful spending, of their money, but a small amount paid out that will return payment a hundred and a thousand fold; not only in opening up for us the new markets we need and in building up our commerce and developing our industries and resources, but in pro- viding for the national independence and safety and in upholding the national dignity and honor among the great nations of the earth. And all that is asked of Mr. Wells and his fellow theorists is that they shall be fair in their statements and stick to the facts.