like to do a trade coastwise, but we would like to get the South American business which will be east of us really when the canal is finished that is, the trade with Peru and Chile. We got busy and chartered a few ships, and started in on the east coast of Mexico pending the construction of the canal, so as to get a trade in line, and if possible form the nucleus of a steamship line which would be able to use this line when it was finished. We ran four ships out of New Orleans floated with every pound that they could carry of Mississippi Valley products, and these ships returned home without a pound of cargo. The manipulations and the machinations of the foreign flag steamship agent is the thing, in combination with the railroad interests, with which they are closely allied, which frustrates our efforts and makes capital timid and drives it away, and hence there is no American shipbuilding worthy of the name. When the canal is finished, if it is open for traffic to-morrow, we have no ships to use the canal, and we know and feel convinced we will never have ships unless we can give them that freedom through the canal that they have on all the other waterways that we in any manner control, and also on the high seas as well. The steamship builders have had in their hands practically contracts for the construction of these ships, but the agitation of the Hay-Pauncefote treaty has scared everybody off and nobody wants to build these ships until a fixed determined policy is established which will enable them to build them along some kind of security or other.

Take the ships that are now available of the Pacific Mail Co. They are ships that are antiquated and not ready to use the canal. They are not suited. They could not be prepared to use the canal. They are entirely out of date. Take the Atlantic and Pacific ships, the ships owned and controlled by the Morgan Line

Senator SIMMONS. The Commissioner of Navigation said the other day that probably the type of a ship that could be most economically employed in that trade was the 4,000-ton ship.

Mr. PORCH. Who said that?

Senator SIMMONS. The Commissioner of Navigation, Mr. Chamberlain. And I think Prof. Johnson agreed with him that the type of ship, the class of ship, so far as registered tonnage was concerned, that could most economically be employed in the intercoastal trade was the 4,000-ton ship. I think he estimated-Senator O'Gorman will correct me if I am mistaken about this-that eliminating from consideration railroad-controlled ships and trust-controlled ships, that would be barred, there would still be about 45 ships that were suitable for use on the canal that could be employed, that are now engaged in the coastwise trade. If you add to that 45 that part of the railroad-controlled ships that possibly would go into private ownership and could be employed in the canal traffic, according to their statement, we would have a right smart little flotilla.

Mr. PORCH. Of course, if there are 45, and I have no record of that many-I am familiar with the lines that have their ships-if there are 45, it could not for a moment be supposed that they would be taken off the trade which they have built up during a series of years and be put into an experimental trade through the canal. They could not be induced to quit the already established routes and go in and seek this new avenue of trade which I have just mentioned.

And as for ships as they are building them now, the general trend of all ships is upward in carrying capacity. Take the United Fruit Line, I remember a few years ago when they had ships which were less than 2,000, down close to 1,000, and they are now building ships from 7,500 to 10,000 tons. The general trend is larger ships and more room, more economically handled per ton, and the overhead cost in the operation is so much less, and especially is that true on long voyages.

Senator SIMMONS. Then, will you let me ask you this question? Mr. PORCH. Yes.

Senator SIMMONS. Would it be of any benefit to New Orleans if the ships engaged in the coastwise trade were permitted to stop at the various Mexican ports on both sides of the coast?

Mr. PORCH. No; they could not do that and make time. And it is a matter of the stowage of the cargo. It is exceedingly difficult for boats on long voyages to make innumerable stops. We find that the cargo which is taken on at the various ports is of such a nature that it does not stow well.

Senator SIMMONS. Does New Orleans do any coastwise trade now with Mexico?

Mr. PORCH. Yes; we have a line to Mexico.

Senator SIMMONS. Only on the eastern coast?

Mr. PORCH. That is all.

Senator SIMMONS. When the canal is opened, the Mexican westerncoast trade would be of importance to you also?

Mr. PORCH. Very little. They are all open roadsteads, and they are not developed ports, and they will be of very little service to us. Senator SIMMONS. If this exemption were confined to ships that were engaged exclusively in the American coastwise trade, so that a ship engaged in that trade sailing from New Orleans could not stop at any port and take the freight at any port, either on the eastern coast or the western coast of Mexico, or any other country, so far as that is concerned, north of the canal--and there are several of those that front on both coasts-would not that make the exemption of tolls of very much less value to you?

Mr. PORCH. NO; I think the boats trading through to the west coast make no stops.

Senator SIMMONS. They make no stops at all?

Mr. PORCH. No.

Senator SIMMONS. You think they would not make any stops? Mr. PORCH. No.

Senator SIMMONS. Then they would sail down the coast passing these countries south of you and sailing up the coast, passing these countries north of the canal, without taking on any freight at all? Mr. PORCH. No; it would hardly be worth while.

The CHAIRMAN. Have you anything else, Mr. Porch?

Mr. PORCH. I wanted to say in conclusion that the point that we raise and the strong point that we stand on, is in the manipulation of this in your wisdom that you do not do anything in the line of giving free tolls for an untried canal. Every prognostication in the figures that I have seen as to the development of the canal I believe is very much underestimated, and I believe that as time passes the use of this canal to connect the west coast of our own country with the east coast, and the Gulf coast, is one of the most important

considerations involved in the canal, and at least do not do that. for the immediate years coming because of the fact that it will be perhaps many years before we have such steamships under the American flags as could trade offshore.

I want to say that I have a legal opinion that was written by a very eminent lawyer in our city, Mr. W. O. Hart, that I was going to ask permission to read, but inasmuch as he has come into the room I should like to ask that the committee allow him a short time to give his own legal opinion as to the canal.

The CHAIRMAN. If there be no objection we will hear from Mr. Hart. Mr. TOMPSON. The delegation wishes to thank the committee for the opportunity which has been given us for these hearings, as we had no opportunity in the House, and particularly thank Senator Thornton, who interested himself in getting us this hearing.

STATEMENT OF MR. W. O. HART, ATTORNEY AT LAW, NEW ORLEANS, LA.

The CHAIRMAN. Mr. Hart, you are a member of the bar, I presume, of New Orleans?

Mr. HART. Yes.

The CHAIRMAN. And have been for how many years?

Mr. HART. Thirty-six years.

The CHAIRMAN. You are a graduate of what law school?

Mr. HART. None.

Senator THORNTON. May I take the liberty of interjecting here that Mr. Hart is not only a member of the bar of New Orleans, but one of the most prominent members?

Mr. HART. It is inconceivable to the student of political economy and international law what basis there can be for the repeal of the exemption. It is monstrous, to say the least of it, that a foreign Government may interfere in the internal concerns of the United States. Probably from the beginning of this Government its coastwise trade has been confined to ships flying the American flag, and if there is discrimination in the use of the canal against other countries, it is in preventing foreign vessels from engaging in the coastwise trade of the United States, and if the United States has and had the right to limit that trade to vessels flying the American flag (and this proposition no one seems to dispute), what interest can any foreign government have or urge against any additional privileges given to such ships in the waters of the United States, of which the canal is a part?

If the repeal is based upon the theory that the United States in other matters owes some obligations to England, Japan, and other foreign countries, and that these can be offset and be settled should the repeal take place, then the international relations of this country are in a sore strait if the rights of our people must be compromised under such circumstances. If the United States owes any obligations to Great Britain, growing out of the Mexican situation, or to Japan,growing out of the California situation, then these obligations should be met and disposed of as they arise, and not tacked onto a matter which concerns our own people alone.

The United States owns the Panama Canal and can fix whatever rates of toll therein it may desire, and no foreign country can urge that the tolls are too high, so that the argument made that by letting coastwise ships go through the canal free their ships must pay more ignores a matter in the settlement of which (the amount of tolls) this country can not be interfered with.

The Suez Canal though owned by a foreign corporation is practically controlled by England, and this country nor anyone else can dictate to England what the rates of its tolls should be, and so no foreign country can dictate to this country what the tolls through the Panama Canal should be.

No treaty can deprive the Congress of the United States of control over the internal affairs of the United States. The original Chinese exclusion laws were passed in the teeth of treaty provisions, but were maintained by the Supreme Court of the United States on the theory that the preservation of our people must be the paramount law and that no treaty could have the effect of depriving Congress of the right to legislate for the people of the United States.

On this point I desire to quote a few extracts from a recent article by Prof. Butler, president of Columbia University:

Moreover, it is established law in this country that a treaty made between the United States and a foreign nation is subject to such acts as Congress may subsequently pass for its modification or abrogation. It is not even necessary to discuss with the other party to the international contract what it thinks of the proposed action of the Congress of the United States. This means tha a treaty made by one constitutional agency may be modified or abrogated by another constitutional agency which is quite distinct from the treaty-making power. This * * doctrine has been laid down by the most eminent judges in the land * * *. The highest courts have held, therefore, that, while a treaty and an act of Congress are both binding upon the courts, the one which is later in point of time takes precedence in respect to authority. Whether a treaty has been violated by our domestic legislation so as to be the proper action of complaint by a foreign Government is held not to be a judicial question. To the courts it is simply a case of conflicting laws, the later modifying or superseding the earlier.

I do not mean by this that Congress should violate a treaty whether with England or with anyone else, but this circumstance shows, as do other decisions of the Supreme Court of the United States, which have several times been referred to during the debate on the tollrepeal question, that the coastwise trade of this country can not be affected by treaty stipulations, the presumption being that no treaty could ever be intended to affect same; and, that being so, the granting of exemption to coastwise ships is not only legal, but a proper exercise of congressional power.

The South and West, and particularly New Orleans, will suffer more than any other part of the country if the exemption is taken away, because, if coastwise ships going through the canal are forced to pay tolls they can not compete with the transcontinental railroads, and the desire for the repeal is not because England believes any treaty right has been violated by the exemption, but because England, solicitous as it ever is for its trade and commerce, knows how the Canadian Pacific, the Grand Trunk Pacific, and the Canadian Northern Railroads will suffer if coastwise ships do not have to pay tolls, and because the seven transcontinental railroads of the United States and other interests favor the repeal for the same reason.

In my humble judgment, I do not believe the people of this country appreciate the importance of the issue now presented in the Senate of the United States. It goes further and cuts deeper than the question of free tolls, because it presents the question of the right of a foreign government directly or indirectly to interfere in the internal affairs of the United States, and if the United States once admits that right, it must accord it in every similar case, and we will find that we will have to consult the other nations of the earth before we can legislate for our own people, and I do not believe the sentiment of this country will allow the Senate of the United States to place our people in such a humiliating position.

Senator THORNTON. Just one question. You have quoted a statement from the writings of Dr. Nicholas Murray Butler on international law, which you think sustains your present contention. Are you aware of the fact that he is one of the most pronounced advocates against free tolls?

Mr. HART. I am. But this was written at a time not suspicious that I quote.

Senator SIMMONS. Mr. Hart, you would not insist, because as a general legal proposition, an act of Congress passed subsequently to a treaty would to the extent that it conflicted with the treaty abrogate it--you would not think it was keeping that faith that nations observe in dealing with each other if we should simply, because we have the power by act of Congress to change the treaty, change it?

Mr. HART. Certainly not.

Senator SIMMONS. A treaty between nations would not be worth anything if the next week or the next month after the treaty was passed they passed an act of legislation abrogating it?

Mr. HART. No; but I simply referred to the Chinese exclusion act, and on the theory that Congress and the Supreme Court of the United States both held in the Chinese exclusion case that a treaty could not interfere with internal affairs of the State; that the internal affairs of the State should be first considered; that we are not going to construe a treaty heedlessly, but when it comes to internal affairs we must decide it for ourselves.

Senator SIMMONS. Are you in favor of exempting American ships engaged in the over-seas trade from tolls?

Mr. HART. I would be in favor of it if it was not against the treaty. I do not go that far, however. I do not go that far, because I do not think it is necessary for the present discussión.

Senator SIMMONS. Let me ask you: Are you aware of the fact in taking that position that our ships engaged in coastwise trade also engage in the foreign trade?

Mr. HART. No.

Senator SIMMONS. You did not know that?

Mr. HART. They may stop at one foreign port, as I understand it. Senator SIMMONS. It is now under our laws entirely admissible for a vessel lower enrolled to also take out registration papers for a coastwise vessel; but it might in going from coast to coast engage in foreign trade with any of the countries on either coast.

Mr. HART. Yes.

Senator SIMMONS. You are aware of that fact?

Mr. HART. Yes; but I understand it is a fact they do not do it.