British Mercantile Marine

Hawke's Bay Tribune, Volume XVI, Issue 96, 10 April 1926, Page 9

British Mercantile Marine

Its Service to Mankind

In his address on being elected President of the Chamber of Shipping of the United Kingdom last month, the Right Hon. Walter Runciman said some pertinent things relating to the services of the British Mercantile Marine to mankind.

“Without the spirit of faith and adventure,” he said, “which emboldened shipowners to enter into great commitments and to provide for traffic far in advance of what was in sight at any one moment, the cost of carriage by sea could never have been reduced as it was decade by decade to the low level of pre-war days.

“Carriage by sea is far and away the cheapest in the world. We bring grain from Buenos Aires to London for 12s 6d per ton, a distance of 6,294 miles, but for the shorter run of 66 miles from London to Northampton the railway companies charge 14s from station to station.

“Such amazing achievements in sea carriage are the direct outcome of scientific skill and commercial capacity, of winch we would beg some notice to be taken by those presuming to be our critics.” Continuing he said;--

every ground, whether for the support of life here or for the provision of payments abroad by which we can buy what is necessary for our households and our factories, the services of British shipping are of prime importance. They are, if not the keystone to the arch, at all events such an important part of it as to justify us in saying that the balance of trade could not be unheld at its present high figure without the earnings of shipping at something like their present size. Indeed, we should be short of food and raw materials and many necessary manufactured articles, which at present we must buy from abroad if our civilisation is to be kept up to the present level, and our comforts and supplies are not to be restricted, unless freights are earned in every port of the world by vessels which ply in the international trades.

The importance of this economic fact is greater in the life of this country than in that of Europe, America, or Asia. It is our foreign trade as a whole which enables us to support the 44 millions of people in Great Britain, and without our foreign trade it is doubtful if the country could support 20 millions. In the provision for payment, which in itself is the first condition of foreign trade, shipping plays a greater part than does almost any other single industry. INVISIBLE EXPORTS AND NATIONALISATION. I draw several lessons from this which ought to be part of common knowledge and should certainly be ever present in the minds of Ministers and public men, whether they are in the House of Commons or in commercial offices or at the headquarters of trade unions. The first is that an industry so vital to national well-being should bo respected. It should not be lightly used for polemical acrobatics. Second.—Whatever may be said in criticism of the capitalist system elsewhere, it is cfear that this gigantic engine for international service and for the payment of British supplies is the direct outcome of enterprise in which capital and profits play a potent part. The State has never created a single item of foreign trade, it has never organised a single foreign service. The State’s relations to shipping have been those of regulation and restriction, which in the main have been good and supported by the industry, although sometimes merely irritating, expensive, and in no respect beneficial. What has been done by the Sta+e for the protection of human life is welcomed by every sane man, and all that we ask is that legal provisions for the greater safety of men afloat should be of universal application and that international organisations like the League of Nations should devote themselves to raising the standards to the level of the highest and make them of world-wide application. Third. —Tampering -with the delicate adjustments of international trade produces bad results more quickly in shipping than in any other industry, and experiments in State administration can only be made at grave risk, not to the shipping community alone, but to all the millions who depend on foreign trade directly or indirectly for their livelihood.

EXPERIENCE OF STATE OWNERSHIP. Fourth. — Whatever may be ' thought of the possibility of State ownership and organisation of manufacturing and mining industries, no one has yet suggested that British shipping employed in foreign trades should be run as a State concern. The experience oi, the United States of America, I Australia, and Canada all goes to ' show that in international trade State Departments and the sub-; sidiaries of State Departments—' and no matter how well they die. manned—are incapable of Keeping! their financial heads above waie : in the fresh breezes of international 1 competition. The United States ' lose many millions of dollars a year i on their huge merchant ileet and ' hundreds of their vessels are de-, stined to be broken up and will : never be able to ply again over- i seas. Their loss in trading is un-' paralleled. The Government the' Commonwealth of Australia Lave endeavoured to abandon their State enterprises, for the loss on them is 1 heavier than can be borne. Canada ' has had a similar experience, and has learned that State enterprise in shipping leads, not to profit, but; to loss. Now, if British shipping! were to produce a net loss year; after year it could not continue, I and would fail to do its share of; payment into the category of in- 1 visible exports of foreign food and material and goods, which we require to keep life and comfort

secure. It is only if, in the main, it makes its profits that it can continue to contribute to the payments abroad, which are the first condition to be fulfilled in the markets of the world in the process of feeding and supplying our people. Amongst invisible exports are found not only the net national shipping income, but also the net income from overseas investments. On this led it be observed that it private property is to disappear and war is to be made on capitalism, there can be no such thing as investments held by British citi zens. Overseas investments must disappear with the aoolition of the capitalist, yet the overseas investments of individual capitalists in this country provide a net income abroad of roughly £250,000,000 pei annum. To wipe out the capitalist would, therefore, mean that our people would have to go short of food or raw materials which they now buy to the extent of at least 250 millions sterling per annum. MERCHANTS AND STATE SOCIALISM. Another item of invisible exports is described by the Board of Trade as commissions. Commissions are the earnings of the merchant and broker class. We, as shipowners, have many a tussle with merchants. Some of them are bad or indifferent. Most of them are honest fellows who are performing an absolutely essential service in the process of exchange of goods and the provision of supplies. The only fault we have to find with them is that they place an inadequate price on the services which are rendered to them by shipping. They show an unfortunate tendency to squeeze freights down, greatly to the shipowners’ disadvantage ; but, just as we know that the world cannot do without its merchants, so the intelligent merchants, I am glad to say, have realised tha tthey cannot do without their shipowning friends. The State Socialist would wipe them all out, and there are thoughtless people in every class of society who think that the middleman and broker are parasites. The middleman and the broker provide the mechanism by which those people who suffer from scarcity can be assured of the surplus supplies available for them elsewhere, and brokers and merchants alike are not only the intelligence officials of the commercial and industrial world, but are even the authors and architects of great commercial expeditions and enterprises. Apart from their virtues, they provide each year, through commissions, etc., overseas, some £40,000,000 ot invisible exports for services rendered abroad. If that item were wiped out, Great Britain again would go short by £40,000,000 of what she needs. There are some other odds and ends which bring the total of invisible exports up to £120,000,000. State Socialism would wipe out this vast sum. For in principle and by declared aim they would do 1 away with the private investor, the commission broker, and the merchant, an dwe know from dearly bought experience that the net shipping income would vanish under the withering bl«ast of Government ownership and administration.

SHIPPING ESSENTIAL FOR OUR FOREIGN PAYMENTS. One remarkable fact emerges from this brief summary of the national balance-sheet, and that is that the cost of the food from abroad which sustained our people last year came to £572,000,0-00. This, you will observe, is net greatly in excess of £420,000,000, the figure of our invisible expnitt. Wipe out these invisible exports, which are the direct product of the capitalist system, and our people as a whole would at once be cut off from the supplies which now flow into their granaries and warehouses, stores ana shops, from Asia, Africa, Australia, and America. They would no longer be able to buy the grain which is grown on the plains of North America or of Argentina or of Victoria and New South Wales. They would no longer be able to feed their childen on the rice of Rangoon or on the foods that are based on maize and beans and nuts and oils. They could no longer secure their cheap meat from Buenos Aires and Wellington. Sydney and Chicago, or vary their diet with the fruits of the Antipodes or of the West Indies or of the tropical islands. Provision for payment for this world-wide fare is found by the shipping industry, the middlemen, and the investors year b yyear. Wipe them out and either half our people must starve, or the whole would have to go on half rations and bid farewell to

some of the varied produce of the earth which has brightened the .tables of every class of the community. We boast of no special virtue in our service to mankind, but we claim that by the nature of things we are indispensable to the wellbeing of Britain, and to tamper with the foundations on which our international industry and commerce have been built would not only destroy the prosperity of the hundreds of thousands of investors who now own British shipping, and of the managers and staffs who direct their course and the seafaring men who navigate the seas, but would cripple our national resources so cruelly and with such fatal results that we could not survive the loss of the greatest and most characteristic of British industries. ♦®*®*®*®*®*®*®*®*®*