AMERICAN SHIPPING A GIANT TRUST

Evening Post, Volume LXXXVII, Issue 75, 30 March 1914, Page 3

AMERICAN SHIPPING A GIANT TRUST

TWO BIG TO DISSOLVE. (FROM OUR OWN CORRESPONDENT.) SAN FRANCISCO, 3rd March. A trust so powerful and so strongly entrenched that any attempt to break it would admittedly prove futile is the shipping combine. This conclusion has been reached by a Congressional Committee after two yeais spent in investigation of the foreign and domestic shipping of the United States. The law of this, country prohibits acts in restraint of trade. According to the linal report of the committee, just made public, shipping lines in practically every trade route to or from the United States are operated by agreements or conferences to restrain trade. To attempt to dissolve these agreements would cripple maritime business, the committee finds, and recommends that it be not undertaken. The pooling agreements or conferences are in operation with respect to shipping across the Pacific as well as that ot the Atlantic. ,The committee found proof that the services between American ports and Australia and New Zealand are amongst those subject to competitiondestroying arrangements of this nature. There are eighty such understandings in existence, involving nearly all the regular lines to and from Europe, Africa, Australia, Asia, South America, Mexico, Central America, and the West Indies. "In the few instances where sevei'al lines served the same trade and denied the existence of co-operative arrangements," says the committee, "it appears that one line was sufficiently powerful to dominate the other lines, and without effecting any definite agreemeht, obtain the desired conditions in rates. ' The agreements referred to present fourteen distinct methods by which the lines seek to control competition either .through the fixing and regulation of rates, the apportionment of traffic, the pooling of earnings, or the elimination of nonconference lines." The committee concludes that "open competition cannot be assured for any length of time by ordering existing agreements terminated." It, therefore, recommends to Congress that in the legislation which is to be adopted, either at this or the succeeding session, agreements and conferences amongst carriers in foreign trade be recognised. Along with this recognition, however, is the turther recommendation that foreign trade be brought under effective Government supervision by ordering that all agreements, be placed on file with tho Interstate Commerce Commission ; that the Commission be empowered to determine the reasonableness of the rates charged ; that rebating be prohibited by law, and that the use of cut-throat "fighting ships" be prohibited. In domestic shipping-*— that on the great lakes and from port to port of the United States — competition has been almost as effectively eliminated as that on the oceans. 'While written or formal agreements^!'© rare, nearly three-fourth. 1 ' of line tonnage operated on the American coastwise and great lakes trade is owru.'o 1 or controlled oy railways or shippinc consolidations. These consolidation* have crushed attempted competition by temporarily cutting rates ruinously. To prevent such unfair tactics thp commit tee makes tho drastic rrcoinmendatiori that a water-carrier-cutting rates agains 4 a competitor be denied the privilege n restoring them. It is also urged that the Interstate Commerce Commission be given full power to fix rates for passengers and freight in domestic shipping, and that the railroads be compelled to make terminal facilities available to all water-carriers under the regulation of the Commission.