WAR ON FREIGHTS.

New Zealand Herald, Volume LXII, Issue 18996, 18 April 1925, Page 11

WAR ON FREIGHTS.

CANADA'S SHIPPING SCHEMESPROPOSED STATE SUBSIDY. !: CONTRACT WITH A COMPANY. [FKOM Oi;it OWN CORRESPONDENT. ] TORONTO. Mar. 21. , The Canadian Government's declaration jf war on ocean rates has let loose a storm of controversey in Canada as well as in England, the homo of many of tho shipping interests involved. In reply to tho charges of excessive rates and of an Atlantic combine, made by the Government's commissioner, Mr. W. T. 11. Preston, on which the Government's proposal to subsidise a competing line is based, the shipping companies have issued long and circumstantial denials. One statement, published by some newspapers, occupied two pages of solid type. Everywhere there is evidence of the keenest activity designed to refute the accusations which have been levelled at the shipping corporations, whose strength may bo gauged from the fact that they have assets greater than the national debt of the Dominion. , . In Parliament tho issue is recognised as much the most acute, that has been raised during the present session. Ihe Conservative opposition, under Mr. Meighen, is vigorously attacking the Government's proposals as being founded on false information, or ill-advised or both. Tho Progressives, many of whom represent constituencies who should benefit enormously from any substantial reduction in ocean rates, are lukewarm to the phase of the Government's proposals, which provides for a Government subsidy; indeed, the Council of Agriculture has on record as being opposed to the plan. Even among the Government's supporters and in the Cabinet itself there is alleged to be a lack of unanimity. The allegation, in view of the fact that shipping interests have, many friends among all parties, may be true. The Suggested Contract. The contract between the Government and the Peterson Company, which provides for a subsidy in return for which tho Government is to secure control of rates, and, thus, it is hoped, break the present scale of tariffs, is to be referred to a committee of Parliament. According to the Prime Minister, Mr. W. L. Mackenzie King, any suggestions agreed upon by tho committee, will, he believes, be regarded with reasonableness by the company. But others express a belief that any material changes will cause the Peterson Company to reject tho contract altogether, whereupon the scheme would collapse. The Prime Minister, however, declares that tho Government will stand or fall on its determination to secure for Canada relief from existing ocean conditions. Part of-the acuteness of the issue is caused by the United States' hostile tariff which prevents Canadian products from finding a market there, and forces them to seek markets overseas. If now tho highways of £he seas are to be barricaded by nearly impossible tariff rates, Canadian trade is in a fair way to bo throttled. It is the most important issue Canada has faced in 40 years, according to somo authorities. Mr. W. T. R. Preston, whose report on ocean rates has caused the tempest, is a stormy petrel of Canadian politics. He is now over 70 years of age. He has been 47 years in public life, probab'.y longer than any of his contemporaries, has successfully- weathered many a storm and is still vigorous and intrepid. Always a vigorous Liberal partisan, he was a quarter of a century ago the chief target in * connection with certain electoral scandals. Subsequently, in the. Canadian High Commissioner's office in London, ho was associated wi'ifo Lord Strathcona, of whom he wrote a biography, which was remarkable for the vigorous attack on the subject of the book. Statement by Mr. Preston. In the present controversy Mr. Preston stands to his guns. He was in England when the first announcement,was made, and reports that his charges created more excitement than anything that has coma out in connection with Canada. In an interview on his return to Canada a few days ago lie said: —"l do not admit that existing rates are necessary, but suppose for the sake of argument I do admit it, none the less they constitute a serious problem for Canada. If rates arc prohibitive what else is left for us but to create a new means of communication, even if it does cost a little money ? For every million that is spent by tho Government in providing cheaper ocean transportation twenty millions will be saved by tha people of Canada. Under this proposed arrangement freights are bound to be onethird less, and in some cases one-half what they are now. The Government will have absolute control df the rates, and there ■will' bd no cornering of the space by speculators or maritime gamblers. Tho actual shippers will reap the benefit. If the service under Peterson is not large enough, it will be made large enough." Not only freight, but passenger rates enter into the problem. "In excess rates, pre-war as well as post-war," said Mr. Preston, "immigrants have paid 40,000,000 dollars (£8,000,000) overcharges. To-day ocean rates for immigrants are fire times as much as they were. It costs more for steerage than formerly first-class: Immigrants cannot pay it. In fact, immigrants can travel from tho Continent to South America more cheaply than from the Continent or Great Britain to Canada. The United States can stand these high rates better than wo can, because they are not dependent on world markets to such an extent. They also have a tramp-steamer' service. The Political Aspect. "Somo people," Mr. Preston went on, "do not like the word subsidy. There is nothing new in that. Our railways wera built by subsidies. Even ocean companies have got from the Dominion Treasury nearly 20,000,000 dollars (£4,000,000) iu the last- 25 years. The country paid thesis ' people, and has had no control over tha rateJfe .Now we are going to pay something and get contrdl over the rates." It is too early yet to gauge the effect, of the issue on Canadian political fortunes. Transportation companies have , been before now a large factor in Canadian elections. Mr. Preston himself once declared that thvy have been a chief factor. It is not likely the Government would deliberately make \var on them .without counting the cost. There is, moreover, thn circumstance that many of tho companies involved are British, and lo attack tha British Mercantile Marine, a chief flower of British world enterprise, is regarded in some quarters as akin to treason. The (joyernrnqnt's course is obviously designed to promote Canadian industry," particularly agriculture, the free trade farmers having been previously told by the Prime Minister that they could expect no further reductions in customs tariffs for somo time to come. As far as the principle of securing lower ocean rates is concerned, the issue will no doubt do something to cement the liaison between Liberals and Progressives. But whether the > farmers will regard the Government's ; specific proposals as proper and likely to ' bo effective remains to bo seen.