SUCCESSFULLY WITH FOREIGN SHIPS? 201 



mand their freight or charter hire in American money, but buy their suppHes as far as possi- 

 ble and pay the wages of their crews in their own depreciated currency. The result is aston- 

 ishing. A case just reported to the American Steamship Owners' Association is that of a 

 Norwegian steamer of a deadweight capacity of 11,000 tons. Her total cost of crew, including 

 officers as well as men, per month, taking the kroner at 12.65 cents, is $1,613 a month, while 

 the total cost of crew of a submarine boat type steamer, with a deadweight capacity of 5,350 

 tons, is $3,302 a month. 



Of course the abnormal difference in cost of operation, due to the present state of inter- 

 national exchange, is temporary; it will not last forever. But for the time being it has the 

 practical effect of a profound discouragement to American shipping and of an actual subsidy 

 to foreign shipping which will have to be met in some thoroughly effective way if American 

 shipping is to live through the crucial ordeal of the three or four years to come. 



Wages and maintenance together make up about 1 5 per cent of the total operating costs 

 of a modem freight steamer. The present cost of wages and maintenance to our British 

 and Norwegian competitors, largely because of upset rates of exchange, is nearly or sub- 

 stantially one-half our own cost. This exceptional difference, of course, will tend to decrease 

 as financial conditions are restored, but for the present this extra cost of wages and mainte- 

 nance is a grave handicap to American shipping in a period of unprecedented intensity of 

 competition. The difference in wages and maintenance is all the heavier a handicap on the 

 new American merchant marine because America still lacks the well-coordinated mercantile 

 and maritime organization all over the world which enables British shipowners to meet the 

 competition of continental nations having wage rates still lower than the British scale. The 

 effect of this close British cooperation in every country, in every trade and in every port, of 

 British agents, merchants and bankers in enforcing preference for British ships, makes that 

 shipping in effect one of the most thoroughly protected industries of which there is any record 

 in commercial history. 



An excellent case in point has just been afforded in the effort of the United States Ship- 

 ping Board to secure for American ships the carrying of Egyptian cotton from Alexandria 

 to this country. American cotton mills are liberal users of the Egyptian fiber, practically 

 every pound of which has for years been brought to the United States, either directly frolm 

 Egypt or via the United Kingdom, in British steamers, through a close working agreement 

 between cotton merchants in Egypt and the Liverpool conference lines. 



When American steamship companies a year ago sought for their own vessels a share 

 of the carrying of Egyptian cotton destined for the United States, their officials were told 

 that this had been and would continue to be a British monopoly, and American vessels could 

 not hope to have any share in it. For the time being the effort had to be abandoned, but 

 last spring the Shipping Board forced the issue by offering a freight rate of 40 shillings a 

 ton for Egyptian cotton brought to the United States and of 25 shillings a ton to the United 

 Kingdom, while the bid of the Liverpool conference lines was respectively 60 shillings and 

 40 shillings per ton. 



Yet so hard and fast was the combination which British merchants and shipowners had 

 effected to monopolize the Egyptian cotton trade that the lower bids of the Shipping Board 

 were immediately rejected, and rejected with the approval of the Liverpool and Manchester 

 cotton exchanges. The characteristic intensity of the devotion of British merchants to their 

 own country's shipping is shown in the insistence of these British business men in handling 

 Egyptian cotton in their own country's ships, though it cost them a far greater price than if 



