because there was an advantage to be gained of which individual enterprise could not reap the benefit. But where subsidies have been given, as has been recently the case in France or as was done in America in the instances already described, as a means of encouraging private commercial enterprise, it has not proved good business policy. It has caused waste instead of economy, loss rather than gain; it has not proved a source of naval strength or commercial prosperity for every nation which has adopted it. It has turned out to be simply an inducement to extravagance. It is undoubtedly desirable to reduce the treasury surplus; but why? Just because it offers a temptation to extravagant uses of the money. To make the existence of such a surplus a justification for subsidies is simply to court the evil of which we are afraid. If we spend our money recklessly we shall not have so much left to spend, and in that way the immediate danger may be diminished ; but meantime we shall have done the very harm which we wished to avoid. More than this, we shall have laid the foundation for future evil of the same sort; for any such lavish expenditure of money conceals the need of wise measures to prevent its accumulation." CHAPTER XII. Future Growth of American Trade The Demand for an American Merchant Marine-The Opening of Foreign Markets-A Canal to Connect the Two Oceans Necessary-Our Possessions in the ΤΗ East to Help Gain the Commercial The views of SENATOR WILLIAM P. FRYE, of Maine HE discussion of the policy of the present administration in regard to our new possessions, in regard to the subsidizing of American steamship lines, the construction of a ship canal on the Isthmus connecting the two great continents of the Western hemisphere will add much to the intelligent understanding of the issues which, in a measure, will be settled during the administration of the new President. Senator William P. Frye, of Maine, has been one of the most intelligent students of all these great problems, and commands the respect and regard of men of all parties. His public utterances, therefore, are of unusual interest, as the following discussion will indicate. All intelligent men know perfectly well to-day that in the foreign carrying trade we have nothing to do whatever; we are out of it. OUR SHIPS SELDOM SEEN ABROAD Our ships are never seen anywhere in the world. Four ships of the American Line carry the American flags that go across the water. That is about all there is to it. Last year, with all our enormous exports and imports to and from Europe, our ships did not carry quite 2 per cent., and in all the world they did not carry quite 9 per cent, The Produce Exchange, a few years ago, made a report, and in that report it said 1750 ships cleared from the port of New York in that year for foreign markets, loaded with our products, and that seven of them carried the American flag. All of you know that, and in knowing it you are very apt to forget that we have such a thing as a lake, coastwise and river freight. We ' have the finest in the whole wide world. We have a larger one than Germany, France and England combined in the same trade. To-day our tonnage in that flleet, or documented and undocumented vessels, will reach 7,000,000. Suez Canal, which is supposed to carry the commerce of the world, passed, last year, a tonnage of nearly 10,000,000. The Salte Ste. Marie, in eight months of last year, passed a tonnage of 25,000,000-more than entered London or Liverpool in the same time. It took 3,500,000 tonnage to carry the freights on the Mississippi River alone last year. That fleet carried, last year, 168,000,000 of tons of freight and 200,000,000 of passengers. Your ships in the foreign-carrying trade are unprotected and compete with ships that are protected. Your coastwise, lake and river fleet has been protected for a hundred years by absolute prohibition, no foreign ship being permitted to engaged in it under any condition. There is the difference between protection and non-protection. FOREIGN MARKETS NEEDed How about the future? Are we going to acquire foreign markets in the future? Take your manufactured product alone, which competes with the world? Your manufactured product must meet all Europe, in all the markets of the world, you paying double the wages that they pay. Is there going to be a surplus of manufactured product? Last year we exported, of manufactured product, $1,000,000 worth every day, and yet consumption at home was greater than it ever had been in any year in the history of this Republic. Your wages were higher than they had ever been before, your product was greater than ever before, and your export, as I say, was $1,000,000 a day. A few years ago your export of manufactured product, as compared to that, was a mere bagatelle. In those few years it has been growing in that way. Your surplus product is increasing every hour that we live. It is bound to increase every hour we live, and your necessity for a foreign market is growing more serious every single year. The danger of an unsold surplus is growing every year to be a greater and greater menace to the prosperity of this country. What are we going to do about it? We must double what we have been doing at least, and that you will I have not a shadow of doubt. But you must go further than that. You must look to other sources and in other directions for assistance. Your most dangerous commercial rival in the next twenty-five years is Germany; indeed, she is the only rival you have any occasion to be afraid of, and you have occasion to be afraid of her. Her people are economical and very hard-working. She patterns your machinery the moment you get it out of the inventor's hands today; she even patterns your goods, and in some instances puts them out as American goods. GERMANY'S ENTERPRISE She is determined upon having the markets of the world, and her Emperor equally determined. She has facilities that we have not. Witness what they are doing to-day in establishing great lines to the great East! See what they mean by it! What do they mean by taking the Caroline Islands from Spain? What do all their preparations to-day mean but a commercial war, more savage and more fierce than any that has yet been fought in our time? She does not pay half the wages to-day, in making the identical goods that you make. Are you going to put your wages down to hers in order to compete with her? That would be a menace to the life of the Republic itself. You cannot cut down the wages of your workmen one-half to compete with Germany. If you do, you will then reduce the consuming power of your people one-half and thus double your product. Are you going to stop your mills and run them on one-half time? In that way you simply decrease the purchasing power of your own people and increase the cost of the product. That will not do. BUILD UP THE MERCHANT MARINE My judgment is that several things are to be done. In the first place, I believe that you ought to carry your exports and imports in American ships, under the American flag, with American masters. Make every master of an American ship an intelligent, active agent to find markets for your goods and to dispose of the goods when the markets are found. When you put a cargo of goods from Philadelphia in a British ship, do you expect that the British master is going to help you dispose of those goods? He is going to hurt you in the disposition of those goods, if he can. The idea of our paying $500,000 every day that we live, in gold, to England and Germany to carry our exports and bring our imports, is a humiliation that this American people ought not to submit to longer. I have taken a profound interest in this revival of our merchant marine for a good many years. In 1891 I spent over six months months on the matter, sent for experts from all over the United States to come to Washington to enable me to draft a bill which should revive our merchant marine. We drafted a mail subsidy bill and a bounty bill. Those bills were reported by me to the United States Senate. They both passed the Senate. Then they went over to the House, and the House, apparently without any knowledge on the subject, deliberately cut down the premiums which were to be paid nearly one-half, defeated the bounty bill by about six votes-it was a Democratic House-passed the subsidy bill with the life, as I say, taken out of it, the very last day of the session, too late for a remedy. It was a failure, and a failure because the bill had been emasculated. Some people think if a ten-knot ship takes twenty tons of coal a day, a twenty-knot ship ought to take but forty. If a ten-knot ship takes twenty tons, a twenty-knot ship should take 300 tons a day, and 100 men to handle it. All that we got, and that was by a trade, was these four ships on the American Line. I was |