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Marine Review FOUNDED 1878 SHIP OPERATION : Volume 65 SHIPBUILDING : September, 1935 CARGO HANDLING Number 9 Scuttling the Ship Subsidy Retards Recovery ITH the adjournment of congress only W: few days off, as this is written, all hope of passing any kind of ship legis- lation in this session is futile. The earnest and intensive efforts applied to the preparation of this legislation in and out of congress come to nothing for the time being. As a result of this failure, the shipping in- dustry is now in a very unsettled and chaotic condition. It would have been far better if no legislation had been initiated. To give encouragement to heavy industries is universally considered an important step in recovery. Shipbuilding in normal times-is one of the major heavy industries. As far as mer- chant work is concerned, this industry at the present time is almost non-existent. A consid- erable number of projects involving the build- ing of ocean-going ships have been held up and deferred pending the outcome of shipping legis- lation. Three specific instances may be cited. Early this year the American South African line, operating successfully under a mail con- tract between New York and South Africa, in order to meet definite needs of increasing busi- ness and in line with requirements of its con- tract with the government for new building, applied to the shipping board bureau for a construction loan. Plans for one and two ves- sels of large ocean-going size were ready, so that contract could have been placed with a shipyard in a very short time. This application has been under consideration by the bureau ever since and no action has been taken. At about the same time the Mississippi Ship- ping Co., operating a mail contract service be- tween New Orleans and the East Coast of South America, had completed plans and specifica- tions for two new 9000-ton combination pas- senger and cargo vessels to cost approximately $3,900,000 for the two. Under the terms of its mail contract this line was required to build these two vessels; but under the law the post office department must certify to the shipping board specifically what class of vessels will meet the requirements. Nothing has happened. The reason again—expectation that shipping legislation, which would have the effect of clari- fying the situation, would be passed. On March 19 the secretary of commerce en- tered into a contract with the United States Lines Co. The outstanding provision of this contract was that the company definitely agreed to construct a third ocean liner similar to the MANHATTAN and WASHINGTON for transatlantic service. Prompt construction of the new vessel was guaranteed by requiring the payment of $1,000,000 as liquidated damages if the con- tract for the construction of the new vessel is not: awarded within six months, unless that time is extended by the secretary of commerce. This contract anticipates the enactment of new legislation in which the government will assume the excess cost of construction in this country over that in a foreign shipyard. It also provides that no construction loan will be made by the government unless congress ad- journs without enacting new legislation. In this instance, nothin= has been done so far in placing the contract, though the time limit is not up until Sept. 15. The building of this vessel will call for the expenditure of about $12,000,000 and would be of substantial benefit to the heavy industries of the country. Regard- less of the failure to enact the ship subsidy legislation in this session, some way must be found to carry on with the plan to build this ship which is badly needed to round out an established and successful service. These are but some of the instances among numerous others where initiative has been deadened in carrying out plans for new ships. According to official figures only one mer- chant vessel of any size is now under construc- tion in all of the shipyards of the United States, and that vessel is a ferryboat for service on the North river between Manhattan and Jersey. MARINE REviEw—September, 1935 : 9