The Southland Times. PUBLISHED EVERY MORNING. Luceo Non Uro. WEDNESDAY, MAY 10, 1933. SUBSIDIZED SHIPPING.

Southland Times, Issue 22011, 10 May 1933, Page 4

The Southland Times. PUBLISHED EVERY MORNING. Luceo Non Uro. WEDNESDAY, MAY 10, 1933. SUBSIDIZED SHIPPING.

Unfortunately, as the World Economic Conference approaches, the collection of bargaining implements increases; but there is, apart from the World Economic Conference, sufficient excuse for the proposal that Britain should discriminate against the shipping of foreign powers who exclude from their trade ships flying the flags of other nations. People in this country are aware of the conditions in the Pacific which close the ports on the run between New Zealand and San Francisco to all British ships, and yet permit the American ships to trade between any British ports. The vessels on this Pacific run have another advantage in that they receive heavy subsidies from the American Government, so that they can either undercut the British ships, or offer such luxuries in the way of accommodation that are impossible on the un-subsidized ships flying the Red Ensign. If this type of competition were confined to the Pacific trade, New Zealanders might say that this was a matter having a local application, and they might add that it was a fight between the Union Steam Ship Company and a United States Company, backed by the United States Government; but the battle is of an imperial nature, and quite recently we have been informed of the number of foreign ships carrying dominion produce to the Old Country. In that list, fortunately, New Zealand’s name does not appear, but the Australian figure is very high, and it shows that foreign traders have taken a very large share of Australia’s carrying trade. It will be stated that the foreign ships take the cargoes at a lower rate. This is probably true; but it does not alter the fact that the saving in freight achieved by the use of foreign vessels is cutting down the revenue Britain derives from her shipping industry, which, with her interest from foreign investments, represents that import of money which enabled her for so many years to show a financial credit balance, despite the fact that her visible trade balance was marked by an annual debit. Certainly, lower freights, like lower prices, will always attract business, but unless the margin is great, it is desirable always to consider whether the saving of the freight is not lost through the weakening of the market in which the shipper must sell his goods. We hear a great deal about tariff barriers, but very little concerning subsidies. Early this year, there were signs that the United States Congress, in view of the depression. was becoming very critical of the large sums devoted to subsidizing the American mercantile marine, and perhaps if this subject comes up at the World Economic Conference, as it should, the American delegates will be ready to see that the use of government subsidies to assist business firms to compete with the business firms of other nations is a barrier to trade and to international friendliness. It is difficult to say how much American governments have spent on the efforts to establish a mercantile marine to compete with the British. They have failed in the Atlantic, but in the Pacific they have a better chance, and, with the aid of subsidies, which increase with every mile travelled by the ship, they are making a bid to capture the whole of the Pacific carrying trade. It is obvious that they and other foreign countries, with the aid of subsidies, are cutting in on the strictly Empire trade, and the effects of this must be felt by the whole Empire, and particularly by the dominions, which have to send their exports to the Old Country as their principal market. In this case the appeal to patriotism is the appeal of selfinterest, and when all sorts of rumours and conjectures are being circulated, it is well to remember always that Britain’s attitude has been, and is still, that Imperial Preference means, first, local industry, and then Empire industry. It is in a proper estimation of values that the solution of the trouble is to be found. Any British subject, wishing to travel or to ship his goods, must, in his own interest, give his preference first to those vessels which fly the Red Ensign, for they are his own ships and the people who man them, the people who build them, are the people who buy the things he produces, the things upon which he depends for his own livelihood.