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but each such vessel adds just so much to the strength of our national defense system as an auxiliary to our navy. By all means let us con- tinue the fixed policy of building up a strong merchant marine.’’ The gen- eral’s statement was received with great applause. APT. S. W. BRYANT U.S.N. ad- dressed the conference on the United States navy and the merchant marine. Captain Bryant said in part: “The merchant marine as I see it is a builder of national prosperity. One of the vital functions of the navy is to guarantee that the mer- chant marine may continue to build for that prosperity. From an eco- nomic viewpoint, a well established and efficient merchant marine will earn many times the amount required for the maintenance of a navy, as history bears witness. Temporary financial sacrifices that may have to be made to put our merchant marine on a firmly established operating basis and keep it there, will be justi- fied by the resulting prosperity, pres- tige and security acquired by the na- tion. “The facts are that— “The navy and the merchant marine are inter-dependent and complemen- tary in accomplishing the purpose for which they exist. “In the major wars in which this nation has engaged and in which we possessed a large merchant ma- rine but not an adequate navy, we have lost most if not all of our ocean carriers and the trade that goes with them. “In two of our major wars, the possession of an efficient merchant marine served largely to avert nation- al disaster. “We are no longer a purely conti- nental nation; our commerce has been extended to all parts of the world and it is not probable that we shall chose to discontinue that commerce. “During the life of our nation we have seen the varied success achieved during various periods in building for prosperity and security both as regards our merchant marine and navy; and as these two basic ele- ments of maritime power are vital to the continued well-being of our race, it behooves us to face the facts and build substantially and wisely for the future.’’ HE next speaker, J. Caldwell Jenkins, vice president of the Black Diamond Steamship Corp., spoke on the subject of “Shipping Leg- islation.” Mr. Jenkins quoted the recommendations presented by the United States shipping board to the congress in its last annual report, in part as follows: 1. Legislation should be enacted providing for the award of ocean mail contracts to purchasers of shipping board services, substantially along the lines of H. R. 9592 seventy-first congress. 2. Legislation should be enacted providing that ocean mail contracts shall not be awarded to American lines operating foreign flag ships in competition with American-flag ships, substantially as provided in S. 628 seventy-second congress. 3. Section 409 (b) of the merchant marine act of 1928 should be amend- ed so as to authorize higher rates of pay than now provided for mail-car- rying vessels whose speed is in excess 24 knots. Mail pay for this class of ships should be commensurate with the increased differential in’ cost of operating vessels of the higher speeds. Tax Exemption Provisions 4. Provision be made for tax ex- emption on American vessels operat- ing in foreign trade, including a pro- vision whereby deductions shall be allowed from taxable income derived from operating profits to the extent that such profits are devoted to new ship construction in American yards. 5. Legislation should be enacted looking to the transfer to privately owned American shipping interests of the peace-time business now han- dled by army and navy transports and by the vessels owned and char- tered by the Panama Railroad Steam- ship line. 6. Funds should be appropriated to carry into effect the act of con- gress approved Feb. 23, 1925, pro- viding for the creation of a naval re- serve, 7. Some form of government aid should be provided for American cargo ships not benefited by mail contracts, in order to lower the oper- ating differential which now handi- caps these vessels in competing with ships owned and operated by for- eigners. 8. It is recommended that the limitation of $185,000,000 on the amount of construction loans as pre- scribed in the independent offices ap- propriation act, fiscal year 1932, page 21, be removed, and that the shipping board be authorized to enter into contracts to make loans up to the ultimate amount of the fund, namely, $250,000,000, the board, however, not to obligate itself to make actual disbursements of money in excess of the available cash bal- ance standing at the time to the credit of said fund. 9. It is recommended that section 11 (a) merchant marine act, 1920, be further amended to provide that the contributions to the construction loan fund by the United States ship- ping board be permitted to continue until such sums, plus appropriations by congress, reach the maximum of $250,000,000 provided by section 202 (b) merchant marine act of 1928. 10. It is highly important that MARINE REVIEw—March, 1933 legislation be enacted granting au- thority to the board to extend, re- arrange or hold in abeyance pay- ments due the construction loan fund, under certain’ restrictions which would protect the interest of the government, substantially as provid- ed in H. J. res, 328, seventy-second congress. And here is what the board says in this same report just following the statement of recommendations: “Had it not been for the aids granted by congress in 1928, it is doubtful if many of our overseas services could have survived the dis- tressing conditions which have pre- vailed in international trade during the past year. “The United States, foremost ex- porting nation and principal con- tributor to international long-voyage passenger traffic, actually has less tonnage in the foreign trade per ton of exports, or per head of population than has any other commercial mari- time power. Notwithstanding the rapid growth of its commercial ship- ping since the war, its minimum needs are still far from being satis- fied in the matter of modern vessels. In this connection it a point worthy of note that six other countries have each launched more tonnage within the past four and one-half years than has the United States. ““ ‘In view of these facts the board cannot with equanimity contemplate any proposal that would tend to in- terfere with the avowed policy of the American people to build up an ade- quate merchant marine.’ ’’ “Now, my friends, I submit that it is the plain duty of the industry to study these recommendations from a technical and practical standpoint, and if it is thought they are unsound in any respect, then go to the board and thrash out any difference of opinion. If, on the ®ther hand, we think they are sound and needed from the standpoint of the govern- ment and of the industry, we should get behind them and assist in having them enacted into law. “Pussyfooting in and around con- gress to get this concession or op- pose this or that measure, some- times with a divided house among ourselves, will not work to the best interest of the industry or improve the standing of those who are in it. I firmly believe that congress would like to see these matters handled as an industry organized and equipped to speak on the subject in such a manner as will command the fullest respect and confidence of everybody concerned.’’ ALCOLM M. STEWARD repre- M senting the Middle West For- eign Trade committee spoke on “The Middle West Interests in the American Merchant Marine.” Mr. Steward called attention to the fact that for many years the people of the Middle West have been 15