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To Amapala, Corinto, San Juan del Sur, and Punta Arenas the freight is substantially the same as to the last points indicated.

From San Francisco freight on all the articles above stated to Panama averages from $12 to $32 a ton. To Buenaventura and Tumaco, in the United States of Colombia, the average freight is of from $12 to $40 a ton.

To Esmeraldas, Bahia, Manta, and Guayaquil, in Ecuador, freight averages from $20 to $40 a ton, depending on the character of the goods shipped.

From San Francisco to the various ports in Peru, by the same line of steamers, the average price of freight is from $24 to $40 a ton. To all the ports in Chili the price is substantially the same, for instance: To either Iquique or Valparaiso freight is from $24 to $50 a ton, the average price being about $28.

No bills of lading to Mazatlan, San Blas, Manzanillo, or Acapulco, are made for less than $3 nor less than $4 to Panama and $8.50 to the other South American ports. All freight is payable in United States coin.

The lines of steamers which connect with the Pacific Mail at Panama for the west coast of South America are four in number, namely:

The Pacific Steam Navigation Company.
South American Company.

The “Kosmos” German Company, running between Corinto and Hamburg by the Strait of Magellan.

“ The French Line" between Panama and Bordeaux by the Strait of Magellan.

The number and character of vessels now engaged in the Mexican, Central and South American trade on the Pacific are as follows:

The Pacific Mail Steam-ship Company, an American line of steamers, before referred to, has five steam-ships, which are engaged in transporting freight and passengers from San Francisco to Panama, touching at all American and Central American way ports. This line forms connection with an Atlantic line of the same company at Aspinwall by the Panama Railroad. It carries the United States mail, and during the coffee season makes three trips a month each way between San Francisco and Panama and way ports, and for the rest of the year performs fortnightly service. The distance traversed between San Francisco and Panama is about 2,600 miles.

This company runs also three coasting steamers from Central American ports to Panama. The Pacific Coast Steam-ship Company, another line-also an American company-runs one steam-ship monthly to Mexican ports from San Francisco. It also carries the mail between San Francisco to these ports. There is also a small Mexican steam-ship running to and from San Francisco to Mexican ports. It makes monthly trips, and it receives as a bounty from the Mexican Government $2,700 for each trip, and an abatement of $650 monthly on port charges, and


American shippers by this steamer have a rebate of 2 per cent. of customs duties for patronizing this vessel. The annual subsidy to this ship is about $40,000, which is paid by the Mexican Government.

There are also a number of steam-ships sailing regularly from Panama south-Ilown the west coast of America—and which form the four lines of steamers before referred to. The trade of Central and South America is most largely and rapidly increasing, because the productions in those countries are every year becoming greater. True, a certain class of traffic which was created by work on the Panama Canal has ceased since the work ceased, but in all other respects the trade is increasing.


There are many reasons why the United States should aid American vessels engaged in foreign trade, but the one grcat reason is that European nations, which are our commercial competitors, are sustaining their foreign trade by means of governmental monetary assistance, .and so long as this is done America cannot successfully compete with theirs unless our shipping interests are sustained by our country to the same extent as European countries sustain theirs.

In view of these facts, I submit for consideration a statement showing the amount of money which the leading European commercial nations pay each year to sustain their shipping interests.

I find the facts bearing upon this question very fully stated in a report made by a commercial conference held at San Francisco August 29 and 30, 1889. This conference was composed of the Board of Trade of Portland, Oregon; the Chamber of Commerce of Tacoma, Wash.; Chamber of Commerce of Astoria, Wash.; all the various chambers of commerce and boards of trade of all the leading cities and ports of California; the San Francisco Produce Exchange; the Board of Trade of San Francisco, and the California State Board of Trade, where these matters were elaborately and carefully prepared and reported upon, and from which I venture to make the following quotation:

Eugland has built up her vast shipping interests by liberal subsidies paid to steam-ship companies for postal and other services. France, Germany, and Italy are following England's example with marked

England paid $5,950,000 in steam-ship subsidies in 1854. After our civil war the payment of subsidies was reduced to $4,000,000, but it soon increased to $6,107,000, and thereby England succeeded in checking the attempt at competition by America. American bottoms now barely carry 14 per cent. of American foreign trade, while in 1855 754 per cent. of our foreign commerce was carried in American ships.

France is now quite in the lead among the commercial nations, seeking to push trade into new channels, and is subsidizing her vessels in proportion to her trade even greater than England. France adopts the bounty system.

The French bounty system is as follows:

France pays $11.58 per ton for iron and steel hulls; $7.72 per ton for composite vessels; $3.86 per ton bounty for wooden vessels. “A further


sum of $3.52 bounty is paid for every 225 pounds of boilers and machinery placed on board; also a navigating bounty of 29 cents per ton for each 1,000 miles traversed, the payment being reduced 1 cent per ton for every year the vessel floats.

In addition to this, iron or steel vessels built according to the marine department plans receive a further bonus of 15 per cent; France also pays heavy postal subsidies. The Messageries Maritimes Company, in the Australian and China trade, receives in all about $2,500,000 a year.

Italy pays a construction bounty of $5.70 per ton for iron and steel; also a bounty on engines and boilers, a navigation bounty and other specific advantages are given.

Germany aids liberally in construction and pays heavy postal subsidies, the North German Lloyds in the Australian and American trade receiving $1,100,000 a year.

Spain pays very liberal postal subsidies, and is extending its commerce, a new Spanish Steam-ship line from Genoa to Colon having been announced recently. Spain pays to its postal route to Mexico, the West Indies, and the United States $1,022 640 per annum, and the line from Havana to the United States receives $20,687 per voyage.

In view of these facts, the man is not a close observer who does not see:

First. That the United States must maintain its foreign commerce, if we expect to secure a market for our surplus products; and

Second. That this can not be done unless the Government assists in building up and maintaining our merchant marine.

The experience of other nations should be a lesson for us. Indeed, there can be no rational reason why the Congress of the United States should not aid American owners of American vessels engaged in the foreirn trade, to the same extent as the owners of vessels of other natims are assisted by their Governments. If it does not do so it will be impossible for American ships to be built and navigated so as to compete with foreign vessels in foreign commerce. As an illustration: Of the total grain fleet last season, at San Francisco, numbering 289 vessels, only 60 were American, while 199 were English; the remainder belonged to other nationali'ies. Estimating the freight at 30 shillings per ton, foreign ship-owners must have received $5,165,304 freight from that State alone, last season, for transporting wheat; while American ship-owners only earned $929,838. In this connection a resolution a lopted by the Chamber of Commerce of the city of San Diego, Cal., expresses the sentiment of the people of the Pacific portion of the United States of America. It is as follows:

Resolved, That we recommend that the International American Congress petition the United States Congress to grant such subsidies to owners of vessels and steam-ship lines as will insure regular trips to and between all important points of Mexico and South and Central American states to the harbors of the United States most convenient to their trade until such time as these trading lines shall become self-supporting.

The next question is what governmental aid is needed to maintain ample steam communication on the Pacific with Mexico and Central and South America. There should be, at least, weekly communication with all the chief ports of the Pacific side of the continent, and to that end I venture to submit the following:



Through the politeness of Mr. M. Lachlan, general manager of the United States and Brazilian Mail Steam-ship Company, I have been furnished with the following facts bearing upon the above points, and after a careful comparison with all the other reports submitted this statement seems to be the most conservative and most carefully prepared of any of them, and I hence present it in his own language:

The distance from San Francisco to Valparaiso is 5,158 miles ; at 13 knots is 396+| hours, or 16 days 13 hours ; time under steam on voyage both ways, 33 days 2 hours. Stays 10 days in foreign ports and 12 days in San Francisco.

This service requires 6 steam-ships of 3,800 tons gross ; estimated cost, $465,000, each fully fitted. First-class ships with accommodation for 200 passengers ; triple expansion 160 pounds steam; no occasion to coal for round voyage in United States,

As Lota coal is very good, but is 20 per cent. less in value as to steaming qualities, hence you require engines 3,400 indicated horse-power at 11 pounds per horse per hour ; say 5,100 pounds of coal per hour, or 541 tons per twenty-four hours, or 926 tons of coal per passage ; add 25 per cent. for contingencies, 1,157 tons coal for permanent bunker room, but you must add to that 20 per cent. more Lota coal, for reasons above given. A bunker capacity of 1,391 tons would leave available for cargo 3,900 tons dead weight and measurement. But there are appliances in vogue which save 28 per cent. of coal, and which, if adopted, would reduce coal consumption to 1,003 tons, which would increase your carrying cargo capacity by 383 tons, or equal to 4,288 tons dead weight and measurement.

The capital required for the five ships would be $2,790,000 and 10 per cent. upon same for establishing of plant.

Agencies, buoys, moorings, etc., would be $3,022,500.

The maximum of the ship's speed would be 15 knots. The actual average would be about 13 knots. It would not pay as a commercial speculation to increase the speed, as your ship would simply be a mass of machinery; it is the extra speed above 13 knots average that eats all profit, unless you have a large passenger traffic and heavy mail pay to justify the speed.

To make the investments necessary for this service I have before stated the United States Government should grant most ample aid for that purpose, and it should be continued for a term of not less than ten years, because temporary assistance would be worse than none and would serve no useful purpose.

Provisions should be made so that the vessels receiving Government assistance would forfeit all claim to it if the owners of such vessels enter into combinations or agreements as to price of freight and passage with any other transportation companies on land or sea. The service should be first-class and freight and passage reasonable. American trade will be destroyed if this is not done.

Traffic on the Pacific route is no experiment. It can be made to pay and pay well.


It is estimated that a first-class line of steam vessels running weekly up and down the west coast of the American continent, charging reasonable freight and passenger rates, could soon quadruple the present business done there; those countries are progressing; their productions are multiplying even more rapidly than the population ; great cities are becoming greater; the market for coffee, India rubber, rare woods, dye-stuffs, sugar, tobacco, hides, etc., can not be supplied, and many of these articles are produced only in Central and South America. Very soon there will be an inter-oceanic canal; if not constructed in one place it will be in another ; but in any event it will be made to cross the Isthmus. This will give a new impetus to western trade. The future of these countries can not be measured by any examination into their past history. We can not look at events of the nineteenth century through the clouded vision of the fifteenth century and judge what is to be in the near future.

The introduction of new industries has given new business life to these people, and very soon they will equal if they do not outstrip the rest of the world in the amount and variety of their productions.

The United States of America is at the north of these republics, both on the Atlantic and Pacific side of the continent, and we must now build up our commerce with the nations adjoining us, or we will lose it for all time, and this would be of mutual disadvantage to all the American nations. Indeed, the period in the world's civilization has been reached when foreign commerce must be maintained by all the great producing and manufacturing nations. A market must be had for surplus products, because every civilized people of necessity buys so much that is made beyond the limits of their own country that they have to sell a great deal to foreign peoples in order to balance their accounts, and that nation which finds the best market for what it has for sale is the wisest. To find this market there must be rapid, cheap, frequent, and regular communication between the producing and consuming peoples. The strife to find new markets and to maintain old ones has been so strong within the past thirty years that individual enterprises can not alone maintain steam communication with foreign markets, and especially has this been the case since England and other European countries have entered the commercial field with subsidized vessels.

In a word, whatever may have been the experience in the past as to subsidizing American vessels to-day, with the lights now before us, and in view of the fact that other nations are doing this, and by reason of which have already nearly driven the United States from the field of competition, only one thing is left for this country to do, and that is

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