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Withdrawal of Leviathan Considered Likely Realizing that the operation of the LEVIATHAN would mean a very sub- stantial out of pocket loss, the Inter- national Mercantile Marine Co. made a proposal to the secretary of com- merce, under whose control the ship- ping board bureau now comes, that if allowed to forego the stipulated sai!- ings of the LreviATHAN the company would set aside a Sum €qual to the ec- timated loss to be used in financ ng the building of a third liner of the MANHATTAN-WASHINGTON type. After careful consideration and a favorable recommendation from H. H. Heimann, then director of the shipping board bureau, Secretary Roper decided to re- fuse the company’s offer and insisted on the operation of the LrviATHAN ac- cording to the terms of the contract. It was found that the losses were much higher than had been estimat- ed, totaling approximately $250,000 for the first two voyages, whereas the com- pany’s «stimate had been $80,000 a voyage. The application to be re- lieved from operating the Lrvraritan was, therefore, renewed. It is now un- derstood thet it is likely to receive favorable consideration and that the sailing of the LEvVIATHAN on July 21 will be her last. Reports indicate that President Roosevelt considers the con- struction of a new liner of greater benefit to the merchant marine than any possible prestige which can come from operating the LrviarHan. Ob- viously the inancial showing of the LEVIATHAN, with huge losses resulting to the operator, has strengthened this point of view, and it is now more than likely that the company’s proposition will be accepted. This is a very important decision as it will mean the commencement of the building of a third liner of the effi- cient and popular MANHATTAN-WASH- INGTON type. Plans, it is said, are now ready and it should not take long to arrange the terms of a_ building contract. Board Suspends Rates The acting director of the shipping board bureau, James Craig Peacock, announced on July 12 that the de- partment has suspended the rate tar- iffs filed to become effective Aug. 1 by the Nelson Steamship Co. and the Quaker line, two members of the con- ference of steamship lines operating in the intercoastal service under con- ference rates. All members of the conference have resigned to take ef- fect Aug. 1. The suspended sched- ules contain substantial reductions from the rates now in effect. The period of suspension runs un- til Dec. 1, 1934, unless changed by further order of the department. Dur- ing this period the two companies are forbidden to change the rates now in effect except by special departmental permission. The department’s orders of sus- pension set forth that the rights and interests of the public and the pur- poses of the shipping act will be ad- versely affected if the suspended schedules are permitted to become effective, and the shipping board bu- reau is directed to investigate the lawfulness of the rates, charges, reg- ulations, and _ practices contained therein, The bureau is already engaged in an extensive investigation of condi- tions in the intercoastal trade, and hearings have been held in New 3 ork, San Francisco and New Orleans. On July 12 a further hearing was held in New York to consider replies to questionnaires sent out by the bu- reau on May 8, 1934, to carriers in the intercoastal trade, Improvement in Shipping A notable improvement in Amer- ican shipping is evident from infor- mation recently published by the department of commerce. The gross sea-going tonnage in active service at the end of 1933 was 15 per cent greater than the year before. This recovery applied to both foreign and coastwise trades; foreign recording a gain of 24 per cent as compared with 10 per cent for coastwise. Combination vessels, freighters and tankers all _ partici- pated, but the first group did so only to a small extent as compared with the second and third group. The largest gain, 866,000 gross tons, was for freighters engaged in foreign trade. This increase amount- ed to 48 per cent over the tonnage in service at the end of 1932. Gross tonnage of tankers in foreign trade increased by 104,000 gross tons, or 35 per cent. Participation of American shipping in the transport of goods between the United States and foreign countries, based on the value of merchandise carried, was about the same as in 1932. There was a slight gain, from 34.2 per cent to 35 per cent for ex- ports, and a fractional reduction for imports from 36.2 to 385.8 per cent. According to an announcement is- sued by the General Electric Co., or- ders received for the second quarter of 1934 amounted to $54,005,988, com- pared with $35,539,858 for the second quarter of 1933, an increase of 52 per cent. The second quarter of 1934 was the largest since the third quarter of 1931. Orders received for the first six months of 1934 amounted to $80,983,- 093.60, compared with $61,773,414.19 during the corresponding period last year, or an increase of 31 per cent. MARINE REvIEw—August, 1934 The Shipping Code Status Remains Unchanged A. general code for the shipping in- dustry is still in abeyance since the refusal of the President to approve the provisions of the code presented by General Johnson, and on which agree- ment had been reached within the industry. The President withheld his signature, it is understood, on the rep- resentation by other government de- partments of the danger of becoming involved in discussions of rights of foreign nations under existing treaties because of the rate stabilization fea- tures. The prolonged waterfront and ma- rine workers strike on the West coast revived the possibility of re-opening the question of approval of the gen- eral code. General Johnson in his speech at Portland, Ore., expressed the opinion that the marine labor diffi- culties might have been settled had there been a shipping code. Under the terms of the President’s executive order, permitting General Johnson to put in operation divisional codes where a master code may prove impossible, it is readily conceivable that the shipping industry might be divided into groups for this pur- pose. Such action without Presiden- tial approval is limited to groups in- volving less than 50,000 workers. It is clear that steamship companies have sincerely tried to formulate a general shipping code for trade prac- tices and labor questions. What the result will be with reference to the formulation of separate divisional codes is uncertain as this is written. Ocean Mail Contracts By executive order, dated July 11, President Roosevelt has directed the postmaster general to investigate all ocean mail contracts and to make rec- ommendations as to modification or cancellation. The postmaster general must complete his investigation with- in six months from the date of the order. It is possible that this marks the beginning of a complete change in the method of aid for the merchant ma- rine. As is well known, the Presi- dent is in favor of a straight out subsidy instead of the present system of mail contracts. Forty-four ocean mail contracts are now in effect. The total amount paid by the government under these contracts in the fiscal year, 1933, was $26,054,000. The executive order also includes an investigation of for- eign air mail contracts. Action will be taken at once by the post office department to carry out the President’s order. The plan of procedure had not been worked out as this is written. 19