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June, 1919 307 with a merchant marine commensurate with the resources of our country, the lesson will come with new force, that to sell we must also buy. THE -MARINE REVIEW wasteful and most effective manner. The freedom of the seas, as a working formula of peaceful inter- course, should find a larger concep- It should stand for open ports and as free an interchange of com- modities as the fiscal necessities of the nations will allow. To ourselves, tion. HEN we entered the war in V \ April, 1917, there were about 100 ways available for build- ing steel vessels, and there was about 15 months' work ahead for each way. The output of the 75,000 men engaged in the industry was about 400,000 gross tons per annum, in addition to the out: put of vessels for the navy. : To the United States shipping board were entrusted by the government al- most unlimited power and money for the operation and building of ships. The Emergency Fleet corporation was formed to put into effect the general policies of the shipping board as re- gards.. shipbuilding. Differences of opinion arose almost at once in con- nection with the policies to be pur- sued in inaugurating thé shipbuilding program. The policies which were formulated, however, are to blame for much wasted effort. The problem of steel ship construc- tion was the difficult one. 'Contracts for steel vessels were let to almost any reputable concern which was will- ing to start a new shipyard for pa- triotic or financial reasons. A large number of yards were begun, equip- ment ordered, and work started. It has been thoroughly demonstrated, however, that both management and skilled men are needed to construct and operate a shipyard. Time passed, money was spent, but cy were slow. The construction of large shipyards for erecting vessels was undertaken, the fabrication of the steel to prepare it for erection being sublet to the bridge and structural steel works of the country located at a distance from the seaboard. Special designs of com- paratively small vessels were prepared to meet the needs of this method of building. The output of the steel mills was overtaxed to meet the anticipated needs of these shipyards, but the out- put of ships was disappointing. To meet the labor situation, several steps were taken: Rates of wages were substantially increased early in 1918, to attract workers to the new shipyards and to enable the old yards to increase their working force. The new rates were made substantially uniform all over the country to prevent one shipyard -By Homer L. Ferguson, President, Newport News Shipbuilding & Drydock Co. from being robbed by another. The effect of this and later increases was to increase the cost of vessels so that Shipbuilding Snapshots FE Aisa discussing the subject of American shipbuilding Mr. Ferguson draws many interesting conclusions, a few of which follow. These are taken from his im- promptu remarks delivered before the National Foreign Trade council in Chicago, April 25. Steel equals one-seventh of the cost of ship fabrication. In 1920, Japan will have from 1,500,000 to 2,000,000 tons of ship- building capacity. The English fleet cost $1,000,000,- 000. The world fleet cost over $2,000,000,000. The United States fleet cost $4,000,000,000, but is worth but half of England's fleet. Any policy of building ships at $200 a ton and planning to sell them later at $100 to $125 a ton should be abandoned. The Newport News company gladly canceled orders for $10,000,- 000 worth of destroyers after the armistice was signed. There is no urgent necessity to finish all ships on our war program and where the keels are not lad they should not be started. [Ve have some in this class at Newport News, Uniform wage scale is unsound. - Many workers got from $7000 to $9000 per year. Colored workers often received $100 to $175 per week for 48 hours' work but the results were poor. -- Cost-plus basis wrecks an organ- ization. The government should abandon its present shipbuilding program and then seek competitive bids. Conditions on foreign ships were bad before the war but have im- 'proved toa the extent of attracting American seamen. Oil engines mark a big advance. Oil supplies in this country put us in a position to operate economical- ly with this form of propulsion. Underwriting and inspection _ should be controlled in this country. ilding * now the labor cost per ton is over twice what it was for similar work in the same yard two years ago. The possibilities of the future of the industry are not bright, however, de- spite the interest which has been aroused throughout the country. A large amount of capital has been in- vested in building new and enlarging old shipyards, but it has been invested under abnormal conditions and is greatly in excess of the amount which would have been required in normal times. Unless it is 'written off, plenty of work at good prices will be neces- sary to keep some of the yards going, on account of the high fixed charges. Labor is demanding short hours and high wages, and it is only partially trained at that. The recent reduction in the price of steel has not brought it within range of 1913, prices, and the prices of shipbuilding materials and equipment are on a high level. Ship- building wages have gone up over 150 per cent and wages in the steel industry have risen approximately the. same. The cost of steel vessels per ton, therefore, will be two or three times the prewar prices until. the in- dustrial conditions change. : There is a shortage of vessels for the world's trade, but to enable us to overcome the handicaps under which we labor, wise legislation and some sacrifices on the part of the business interested in foreign trade will be necessary if American built ships are to occupy the position which the fu- ture security of this country demands. One lesson which we should learn from the war is that there is not time after war is declared to build the necessary ships. A large output of ships must be maintained in peace times to keep' the shipyards at a high state of efficiency--in other words, we must be prepared. The wages of first class mechanics engaged in shipbuilding in Great Brit- ain, as recently reported by a rep- resentative British shipbuilder, are $20 to $25 per week, whereas the wages of similar mechanics in the United States are from $34 to $40 per week. The wages of first class mechanics in Japan, as recently re- ported by a representative Japanese -- shipbuilder, are $1.25 to $1.50 per Bien