nial contract the service can be performed and the full compensation earned by slower and smaller vessels, while the size and speed given are required to obtain the full compensation under the system proposed for the United States. Thus ten vessels of the size and speed of the Dunvegan Castle, in the table, would still earn $87,850 under the British colonial contract, while their compensation for carrying the mails at the speed rates proposed by the bill would be only $84,360.

Taking the vessels named in the table, under the bill proposed the compensation for a year would be $498,410, compared with the British contract price of $456,840.

Recently the contract has been renewed, and the subsidy has been increased to $656,100, while larger and somewhat faster vessels are to be employed. The details concerning these new vessels have not yet been ascertained by the Bureau.

The British mail service between Great Britain and New York is carried on by the Cunard and White Star lines, which make semiweekly voyages, the distance from New York to Queenstown being 2,647 miles, and from Queenstown to Liverpool 254 miles, a total of 2,901 miles. The report of the British postmaster general for 1899 shows that these companies were paid £126,792 ($616,209) for mail service, and admiralty subventions increase the compensation to total of $796,029. The following table shows the number of times each of the mail vessels of these lines cleared from New York during the fiscal year ended June 30, 1899. It also shows the pay these vessels would receive for speed only (not including allowance to equalize cost of construction and operation) to offset these British payments. The last column is computed on the basis that each vessel made as many round voyages during the year as it cleared from New York. This, of course, is an overstatement, and the total pay, $1,132,722, is accordingly more than the vessels would actually receive. It is not practicable to state the latitude and longitude of each of these vessels on June 30, 1899, whether it had com pleted a round voyage, had just started, or was in mid Atlantic on the outward or return voyage.

The three steamships of the Canadian Pacific Railway receive £60,000, or $291,600 a year, from the British and Dominion Governments for their voyages from Vancouver to China and Japan. The route is:

The three steamships Empress of China, Empress of India, and Empress of Japan are sister ships of 5,905 gross tons and 15 knots speed. For each round voyage of 12,456 miles under the bill proposed a steamship of 5,905 gross tons and 163 knots speed would receive for speed alone (not including the allowance for construction and operation differences) $8,786.64. The three steamships together make sixteen round voyages a year, and for these voyages under the bill would receive $140,586.

The comparisons thus far have been made between British mail subsidies or contracts and the allowances for speed only with which it is proposed to offset them. The contracts already considered have been in operation many years, and the British lines are firmly established. The Canadian Pacific Steamship Line is relatively new, the vessels having been built in 1891, and the contract is on much more liberal terms.

The total pay proposed by the bill (including allowances for differences in cost of construction and operation as well as the allowance for speed) for a steamship of 5,905 gross tons and 163 knots, making the round voyage described of 12,456 miles, would be $19,694, and for sixteen voyages $315,113, compared with $291,600, which the British Government has deemed necessary. The trans-Pacific trade is relatively undeveloped. British shipping has not gained the predominance there which it has acquired in trans-Atlantic trade. The bill proposes practically the same expenditure to establish an American fast service across the Pacific which Great Britain considered necessary for that purpose barely ten years ago. On the Atlantic, where her lines are established, Great Britain can afford to spend less, and we must be prepared to spend more if we care to share in that trade. The same statement holds true of German competition. At the risk of devoting too much space to this branch of the subject, it is proposed to examine the North German Lloyd contract for the Asiatic and Australian services and compare them with the propositions of Senate bill 5590.

NORTH GERMAN LLOYD SUBSIDY.

In the examination of the British mail contracts just concluded, the British payments have been compared with the sums proposed as an offset to them by Senate bill 5590. The allowance made for differences in cost of construction and operation, as stated, has not been included, except in the Canadian Pacific case.

The difference in cost of construction and operation of American vessels and British and German vessels runs through all classes of vessels, and is an advantage which the fast mail steamships of those two nations enjoy above and beyond the direct subsidies paid by their respective Governments. That the comparison may be made as fully illustrative as practicable, the most recent and important foreign subsidy, the extension of the North German Lloyd contract amounting to $1,320,420, will be compared with the entire rates, including those allowed for differences of cost of construction and operation, which vessels, precisely similar to the German fleet, would receive under both paragraphs (a) and (b) of the first section of Senate bill 5590.

The trunk line of the North German Lloyd contract is the line from Hamburg or Bremen to Hongkong. Every four weeks the company is required, beginning this month, to run a steamship from one of these German ports, the route for the thirteen trips being as follows:

Hamburg to Antwerp

Antwerp to Southampton
Southampton to Gibraltar.

Miles.

374

239

1, 139

The steamships which are to perform this service some time next year, when completed, will be the following, opposite each being placed the entire amount which it would receive under Senate bill 5590:

Two more voyages must be made, besides these twenty-four, to complete the contract. If these two are made at the average for the twenty-four, the sum of $70,710 must be added, making $919,225 in all, which corresponding American steamships would receive in all for the like service. Until three of the large steamships are completed this contract will be performed in part by the German contractors with a 13-knot steamship of only 5,057 gross tons, which would be entitled to only $11,480 instead of $139,320, so that for some months to come American steamships corresponding to those actually used by the German contractors would receive about $127,000 less than the $919,225 named.

The contract requires the North German Lloyd to continue its connections so that once in four weeks Hamburg or Bremen shall be connected with Shanghai and once in four weeks with Yokohama. It is proposed to perform this contract by having the steamships just named, on their fortnightly arrivals at Hongkong, proceed alternately one to Shanghai, a distance of 853 miles, the next to Yokohama via Nagasaki and Kobe, a distance of 1,800 miles. Similar American steamships, going and returning once in four weeks from Hongkong to Shanghai, would receive $33,258, and from Hongkong to Yokohama, once in four weeks as described, $74,779. The company is also bound on alternate fortnights. to operate a steamship from Hongkong to Shanghai, and for this purpose the 12-knot steamship Hohenzollern, of only 3,288 gross tons, is employed. A corresponding American steamship, if paid for that service under Senate bill 5590, would receive $6,839. Still another clause in the contract binds the company once in eight weeks to operate a steamship from Singapore to Friedrickshaven, in German New Guinea, a distance of 3,100 miles. This service is performed by the Stettin, a 123-knot steamship of only 2,478 gross tons, resembling the American steamship Cherokee. If the American steamship were paid for that service by the bill under consideration, it would receive $9,336.

Summing up the foregoing items, American steamships performing the Asiatic contract of the North German Lloyd Company would receive

under Senate bill 5590 (including allowance for difference in cost of operation and construction) the sum of $1,043,467, if the best steamships proposed were in operation, while for vessels corresponding to those actually to be used for a year to come the amount would be $911,000.

For its subsidy of $1,320,420 the North German Lloyd Company agrees also to make thirteen voyages to Melbourne and Sydney, a distance of 12,938 nautical miles. (The route as far as Colombo has just been stated, and from Colombo to Australian ports is shown in the Peninsular and Oriental table.) During the winter the company employs some of its well-known trans-Atlantic steamships in this service, thus effecting an economy when trans-Atlantic trade falls off. The steamships named make each one round voyage a year, while the remaining four voyages are made by different steamships among those included in the list.

The average for the nine voyages is thus $36,489, and if the four voyages required to complete the contract are performed chiefly by the large steamships, $145,956 must be added to the total, making $474,365 for the Australian contract. If the additional voyages are performed by the smaller vessels, only $56,000 should be added, bringing the total to $384,000.

To sum up, the North German Lloyd contract provides a subsidy of $1,320,420. A year hence, when the contractor, with the cooperation of the Hamburg-American Line, has put into operation the steamships now building, American steamships of corresponding size and speed, making the same voyages, would receive, under Senate bill 5590, the sum of $1,517,832, in years when the German contractor employs the largest and fastest vessels on the Australian route for two trips instead of one each. Pending the completion of the new steamships for the Asiatic line, and during the use of the smaller and slower vessel, corresponding American steamships would receive $1,394,000 against the German subsidy of $1,320,000. This winter, if the Barbarossa, Bremen, Konigin Luise, and Friedrich der Grosse make each only one trip to Australia, the German contractor will receive $1,320,000 against $1,295,000 which American steamships, corresponding to the German fleet in operation, would receive from the German Government. If in any one year the fastest and largest of the 136,174 gross tons of steamships used or designed for the Asiatic trade are steadily employed under the contract, the German subsidy will exceed by only $197,412 the proposition in the Senate bill under consideration, less than $1.50 per ton per annum, or just about 10 cents per day per man of the crewa sum hardly more than enough to equalize the difference in provisions of the crew, waiving all question of relative wages and cost of construc

tion. Unless the fastest and largest ships are employed even this dif ference diminishes, and it is very probable that the contract of the North German Lloyd the current fiscal year will be performed by vessels which will draw more from the German Government than corresponding American vessels for the same service would obtain from the American Government under the proposition submitted to the last Congress.

The award of this contract last year was the occasion for a formidable combination of German steamship companies to promote German trade in eastern Asia. The manner and purpose of this combination is clearly set forth in the reports of the North German Lloyd and HamburgAmerican companies for 1898. The former states:

To avoid competition in the application for an extension of the Imperial mail service, we have come to an understanding with the Hamburg-American Line on the subject, so that this company will install a number of mail steamships in the east Asiatic Imperial mail service, remaining in the control of the North German Lloyd. This arrangement, under the restrictions of close and fixed conditions, has the approval of the Government.

Simultaneously, we have reached an agreement with the Hamburg-American Company concerning the prosecution of a joint freight steamship service to the East. This cooperation of the two corporations has an added significance for both companies, from the fact that the Hamburg-American Company has arranged, in the meantime, to join operations with the German-Asiatic Steamship (King-sin) Company. On the basis of this union with the Hamburg-American Company half of the steamships of the King-sin line will enter the service of the North German Lloyd. We cherish the hope that the union of the two greatest steamship companies of Germany for the prosecution of the service to eastern Asia will become the foundation for an active extension of the German merchant marine in the Orient.

The Hamburg-American report explains still further:

An event of special significance to the further development of our company may be noted in our entrance into the competition for the trade of the Orient. The development which German relations to east Asia, and especially to China, appear about to take on justifies our firm determination to follow the policy of our Emperor. We established, therefore, on January 3, 1898, a regular monthly freight line between Hamburg and Antwerp and Penang, Singapore, Hongkong, Shanghai, Yokohama, and Hiogo, with connections to Foochow, Kiaotschau, Tientsin, etc. We have used principally vessels of our A class, which are peculiarly adapted to this service. Nevertheless, as we could not confine ourselves permanently to the employment of cargo steamers alone in such a service, considering the rank of our company and of our whole organization, we have, thanks to the understanding which the Imperial Government and our Bremen friends promoted, entered into an agreement with the North German Lloyd, according to which our company, if the Reichstag approves the bill presented to it, will share in the trade of the German Imperial mail service to east Asia, so that the Government mail steamships shall start alternately every fortnight from Bremen to Hamburg.

The first steamships to be installed by us in this service will be contracted for in German shipyards at the earliest date, assuming always the passage of the bill. As we have succeeded in establishing this friendly relation with the North German Lloyd, and through a fifteen-year contract in obtaining a participation in the east Asia trade, which for this branch of the business of the two companies is hardly to be distinguished from a fusion, so, also, we have taken steps to reduce competition in the trade with Asia by the absorption of the German Steamship Company, of Hamburg (King-sin line), etc.

While the German contract is with one corporation, it will be noted that the corporation has effected a combination so that other interests share in the benefit. How the lump sum of 5,590,000 marks is to be divided on the books of the company, or what amount is to be allotted to each vessel in the service, is not known, nor is it important. The method proposed by Senate bill 5590 of the last session is quite different. Instead of restricting the assistance of Government to one corporation and enabling it to make its own combinations, the bill offers equal terms to all American shipowners, the size and speed of the vessel and the distance traversed being the measure of Government cooperation.