195 Code/120

The Secretary of Commerce (Roper) to the Assistant Secretary of State (Sayre)

My Dear Mr. Secretary: I desire to refer again to you letter of March 10,24 accompanied by the letter from Mr. Charles S. Haight,25 of New York City, setting forth Mr. Haight’s views regarding the advisability of holding an international shipping conference. I indicated to you in my reply of March 19,24 that I would be glad to give you my views in regard to this suggestion at the earliest practicable date.

After careful consideration of the views expressed by Mr. Haight, and of other aspects of this matter, it is the opinion of this Department that the United States Government should not take the initiative in bringing together an international conference involving the rationalization of shipping tonnage. It is believed, however, that if other nations more vitally concerned in the laying up of tonnage should initiate such a conference the United States Government should give sympathetic consideration to its participation therein.

[Page 702]

The substance of Mr. Haight’s communication is that there should be held an international conference to be entered into for the rationalization of ocean tonnage. To give proper consideration to present world shipping conditions, the figures submitted by Mr. Haight, should be clarified by further analysis in order to convey a proper perspective.

Eliminating from Mr. Haight’s figures of the world’s tonnage—stated as nearly 68,000,000 gross tons—tanker tonnage, miscellaneous types, wood, composite and sailing vessels, vessels trading on the Great Lakes of North America and vessels less than 2,000 gross tons, there are available 40,000,000 gross tons of ocean-going types of iron and steel steam and motor vessels for cargo and passenger carrying purposes. Of such tonnage the United States has 6,700,000 gross tons. Of this, 1,500,000 tons comprise the government-owned laid-up fleet, which cannot be considered commercially competitive. This leaves 5,200,000 tons of active vessels; 3,200,000 tons operating in the foreign carrying trade, the other in the coastwise trade.

These figures emphasize the relatively inferior position which the United States—a leading export nation—occupies in the international carrying trade, participating to the extent of only 8 per cent of the total tonnage. The tonnage so employed is confined to services in essential United States foreign trade routes, and none of these ships is employed in the tramp-carrying trade.

The adverse conditions prevailing in the ocean-carrying trade today, resulting from the over-tonnage situation, is believed to be attributable to two principal causes. One of these is the fact that during the last 10 years there has been a considerable amount of ship building throughout the world without a satisfactory accompanying amount of scrapping. Foreign countries eager to modernize their fleets have scrapped comparatively little and disposed of much of their old tonnage in quarters where they constitute a difficult competitive factor in the international shipping situation. In this period, the United States has materially decreased the size of its merchant fleet by scrapping more and building less tonnage than any other maritime nation. This country has also reduced schedules to minimum requirements in our regular services by laying up active tonnage. In fact, if other maritime countries, in proportion to their tonnage, had scrapped as much and built as little as the United States during this period, the supply of ships would not have been so excessive today and there would probably be fewer idle ships at the present time.

Since the United States has already made such a material contribution toward the reduction of world ship tonnage, it would appear an inopportune time to ask the United States to make any further concessions.

[Page 703]

The Congress, in the Merchant Marine Act of 1920, decreed that the United States shall have a merchant marine of the best equipped and most suitable types of vessels, sufficient to carry the greater portion of its commerce. The attainment of this objective, which has never been reached, would require the constant employment of the comparatively small fleet of serviceable American ships available today unless our present position in the international shipping situation is to be jeopardized.

This Department will be pleased to furnish any additional information which may be required in connection with this matter.

Sincerely yours,

Daniel C. Roper
  1. Not printed.
  2. Letter of March 2, p. 693.
  3. Not printed.