Senator OWEN. The objection that you make to the navigation laws is that the navigation laws require better conditions for the life of the seamen and better wages? Mr. PORCH. Yes; just as we live better at home on shore. Senator OWEN. Your contention is, then, that American seamen should be put upon lower wages and less favorable conditions of life in order to promote our coastwise traffic? Mr. PORCH. No; I did not raise the question. I believe they should live as decently at sea as on shore. But I am speaking of a condition we are confronted with. Senator OWEN. I was trying merely to ascertain what the difficulty was in the law. Mr. PORCH. I beg your pardon, but I did not come here to discuss the law, because we live better on the shore than the people do abroad. I am not retrogressive. I do not believe in making our seamen live worse. I do not believe in a reduction of wages that will cause our men to live worse either on land or sea. Senator OWEN. But you said our navigation laws were objectionable because they required a higher condition of life for American seamen and higher wages. The CHAIRMAN. I think he said burdensome. Mr. PORCH. I mean burdensome. Senator OWEN. Whatever term you choose to apply, I was trying to ascertain what the real meaning of your words was. Mr. PORCH. That is just it, because it is a higher and a better plane. They live better and are better paid, and they are more intelligent. Senator OWEN. That explains why the Americans stay on shore, does it not? Mr. PORCH. In a measure. Our people have not been taught to use the sea. The people are not accustomed to going to sea. They have been busy at home, and they have neglected the business of the sea. Senator CRAWFORD. But you do not know to what extent these vessels engaged in the over-sea trade are owned by American citizens, to what extent American citizens furnish the capital and yet have foreign flags flying on the ships? Mr. PORCH. They may have money invested because it pays them. I do not understand that, but I do know that the great and powerful transoceanic lines are so zealously controlled that one could not own a share of stock in them unless he is a citizen of that country. Senator SIMMONS. Do you not know that a few years ago it was charged in the public press that Mr. Morgan and his associates in this country, by reason of their large holdings in over-sea shipping, had organized some sort of an international marine trust? Mr. PORCH. Yes. Senator SIMMONS. So that it is a fact that, while the ships do not fly the American flag, American capital is very largely invested? Mr. PORCH. I presume there is a great deal of American capital in ocean ships. It is not in the ships of the regular lines, but in tramps and merchantmen used in the development of our business abroad. Senator BRISTOW. Speaking of the expense of maintaining an American ship as compared with a foreign ship, due to the larger pay and the better treatment that is required of the men who operate the ship, that necessitates, of course, a higher rate for the American ship than the foreign ship? Mr. PORCH. That is it. Senator BRISTOw. And you put the two ships upon exactly the same conditions as far as trade is concerned, with these requirements which our law makes as to expenditures, and they can not compete? Mr. PORCH. Not across seas, so those who operate ships say. Senator BRISTOW. The higher rate for the domestic traffic, where there is an independent line, and it is not fixed by the railroad in the coastwise trade, is due to these requirements of our laws that require the steamship companies to expend more money in operating their vessels ? Mr. PORCH. Yes, sir.. Senator BRISTOW. And when we put them, so far as tolls are concerned, upon exactly the same basis, we impose upon them still another burden? Mr. PORCH. When we put the tolls on, we do, of course, increase the burdens very materially. Senator BRANDEGEE. Are not our ships engaged in the foreign trade under similar disadvantages with their foreign competitors? Mr. PORCH. They are. Senator BRANDEGEE. Are you advocating that we should give our ships in the foreign trade free passage through the canal? Mr. PORCH. No, sir; I said coastwise. I am not talking about the other feature. Senator BRANDEGEE. Why should we not do it with our ships in the foreign trade if we should do it with our ships in the domestic trade? Mr. PORCH. I think if we get what is saved to us now we will be satisfied, but when the time comes, as the years roll by and the canal is opened to traffic, I think you will be willing more than likely to give us the rest. Senator BRANDEGEE. Why should we not do that now, as well as in the domestic trade? Mr. PORCH. I do not see any reason why we should not. As far as I am concerned, I believe everything should be done to aid our commerce that is fair and legitimate. I express myself in this way as my own personal opinion. Senator BRANDEGEE. If the rate of charges by the foreign ships coming to this country is three times what it is in our ships, do you think the question of tolls in the canal would enable us to compete with them if our vessels were given free passage through the canal? Mr. PORCH. I do not wish it to be understood that our freight rates through the canal will be three times as great as that of foreign countries, but I do know that if we have to pay tolls on the full space of the net of our ships our handicap will be increased that much. A committee was appointed by Congress to investigate this matter of ways and means of using the canal. They took the testimony of the United Fruit Co. while in New Orleans, and in extenso they went on to explain how an American flag boat could never be operated, and they said everything they could against the American flag development, and spoke largely from the truth as it to them appeared. Senator BRANDEGEE. I did not ask you about the findings of this committee. I asked whether- Mr. PORCH. As time passes-I am telling what they think Senator BRANDEGEE. I do not care what they think. I can read that, as it is in the report. Mr. PORCH. That is not in the report. That is what happened afterwards. Senator BRANDEGEE. You are a witness here giving us your opinion about this matter. I asked you whether you think the question of the charging of tolls for our vessels passing through the canal, or the remission of them, will have any effect upon our ability to compete with the foreign rates which you say are three times those of our companies? Mr. PORCH. In our commodity I said it was three times. I did not give the general traffic rates. I said in our commodity they were laying down Senator BRANDEGEE. Can they compete in your commodity, then? Mr. PORCH. I hope they can not. I would hate to think otherwise, but at times; yes, and with free tolls they are enabled to make serious inroads in the iron and steel business on the west coast. Senator BRANDEGEE. Then you are in favor, I assume, of remitting the tolls on vessels engaged in our foreign trade through the canal? Mr. PORCH. I am in favor of it myself. I came to-day to specifically urge to let stand what we have as it is. Senator BRANDEGEE. I simply want to get your entire view. Mr. PORCH. My entire view is the rehabilitation of the American flag on the high seas, and anything that will legitimately lead to that, let us do. Mr. BRANDEGEE. I am in favor of anything that will legitimately lead to it. You speak about our vessels being entitled to the free use of the canal. Somebody has got to pay for the operation of this canal, has he not? Mr. PORCH. Yes; undoubtedly. Senator BRANDEGEE. If you give free use to our coastwise vessels somebody has got to pay for the free use of it by the coastwise vessels? It is free to coastwise vessels, but it cost somebody else something. Who do you think will pay for the upkeep, the operation of the canal, the operation of the machinery, and the consumption of coal? Mr. PORCH. I think the Government of the United States will pay for it. Senator BRANDEGEE. Do you think the Government of the United States, which is all the people, ought to tax all the people to hand over this free passage to the owners of the coastwise vessels? Mr. PORCH. I think if they look to a revenue from American flag boats through the canal, they should also do the same on the Ohio, the Soo Canal, and especially on the Mississippi. I do not see why this should be a case that is singled out where the shipping to be handled in its infancy will practically be nill, should be burdened with that. That does not apply where the Government has spent much money elsewhere. Senator BRANDEGEE. Do you think that the operation of the Panama Canal, 2,000 miles away, down on the Isthmus of Panama, is a part of the operation of the inland waterways of the United States? Mr. PORCH. I think it is a good deal more important. Senator BRANDEGEE. I do not care about its importance. You are saying it ought to be treated on the same basis as our inland waterways, on the ground that it is a part of them. If the canal. was in Africa, you would not consider it a part of our inland waterways system of the United States, would you? Mr. PORCH. No; but it runs through our own territory down there that was acquired for the purpose of the canal. Senator BRANDEGEE. It runs through a part of the Republic of Panama, over which we have a right of way to operate it. Mr. PORCH. Exactly. Senator BRANDEGEE. You do not consider that our own territory, do you, for any purpose except the operation of the canal? Mr. PORCH. For the operation of the canal that we built; yes, sir. Senator BRANDEGEE. It is not our territory for any other reason, is it? Mr. PORCH. It is our country to govern and control as long as we are operating the canal. Senator BRANDEGEE. And for the purpose of operating the canal? Mr. PORCH. For the purpose of operating the canal. Senator BRANDEGEE. If we cease operating the canal, it is not a part of the territory which the United States owns, and it would revert to the Republic of Panama, would it not? Mr. PORCH. If we cease operating the canal, there will be no ships going through it, and that will be the end of the whole matter. But it seems to me that in the construction of this we draw a pretty fine line about what the Government is going to suffer there in comparison with what it will suffer in the development of its commerce, because I regard the transcontinental railroads in Canada as the severest menace. They will do what is equivalent to coastwise service without let or hindrance. Their two transcontinental railroads, and the third one now building, can go through and tap our northern border anywhere and take freight beyond the control or domination of the Interstate Commerce Commission, and we are powerless to avoid it. Senator OWEN. I observe in the resolutions which were offered in the beginning of the hearing, passed by the joint meeting of delegates representing the New Orleans Association of Commerce and the New Orleans Board of Trade, and citizens representing Mississippi, held at the association of commerce April 16, that the resolutions allege that the act of the House of Representatives repealing this toll-exemption provision had been passed without reason assigned to the American people or given to the people through their Representatives in Congress. Do you regard the President's message as containing no reasons? Mr. PORCH. I regard them as not very specific. Senator OWEN. Do you regard his statement that it would be a plain contravention of the treaties of the United States as no reason? Mr. PORCH. I had regarded that as a reason, but it has b en controverted by noted lawyers to such an extent that I do not consider it a conclusive reason. Senator SIMMONS. Let me ask you one question, if you please, Senator Senator OWEN. Just a moment. Do you regard his statement that it would embarrass him in his negotiations with foreign countries as no reason? Mr. PORCH. Yes; that was a reason that has been alleged, Senator, but it was not a reason that we could understand. That is the reason of the action, I understand. Senator OWEN. Do you regard his statement that it was commercially unsound to give this privileges to the few at the expense of the many as no reason? Mr. PORCH. Not to our satisfaction. Senator OWEN. But this resolution alleges "without reason assigned to the American people, or given to the people through their Representatives in Congress," and you sent this resolution broadcast, giving it wide publicity to the people of the United States after the President had given these specific reasons. Mr. PORCH. That is the resolution drafted by these bodies in session at that time, and I suppose could have been made more specific. I think they should have put in the words "conclusive reason,' or something of that kind. Of course, they were aware of the President's message. The CHAIRMAN. Mr. Porch, they were giving expression to their views as they had the right to give them as free American citizens? Mr. PORCH. That is the way they regarded it. Senator THOMAS. They were red hot at the time. Senator BRANDEGEE. You have not considered at all-I was not here when you began and that is the reason I ask it-and you do not base your opinion at all upon any construction of the treaties, do you? Mr. PORCH. Not any more than this: I base it on this: I was in Panama City when Mr. Taft, then Secretary of War, read to the populace the revised treaty from the Hotel Centrale, after having received a cable message authorizing him to release it, from President Roosevelt, and he said, "I perhaps will never have an opportunity to speak to you again on this important matter of the Panama Canal." And then he went on to tell the populace of the three reasons for the construction of the Panama Canal. One was a war measure, another was for the development and connecting up of the two sides of our country for commercial growth, and the third was the building of the canal for the use of other nations along the lines of an offering on the part of a great rich nation for all the blessings that had been showered. on it. Those three were the terse reasons that he gave for the construction of the Panama Canal, and I have never forgotten them. Senator BRANDEGEE. President Taft's views are well known and they are in the record now to a considerable extent. He has written a great deal on the subject. What I have asked you is to give your views as to whether you think under our treaties we have the right to exempt either our foreign or our domestic shipping? Mr. PORCH. Yes; I have my distinct views. Senator BRANDEGEE. Have you studied the treaties to find out whether we have such a right? Mr. PORCH. I have studied them to the best of my ability; yes, sir. |