of November 15, compiled by Worms & Co., of Paris, Suez, Port Said, etc. The original figures are given in francs, which I have turned into American money at 19.4 cents per franc, which is the figure used by the United States in its transactions with the French Government by treaty. This is also the treaty value of the Belgian and Swiss franc and the Italian lire. This value is equivalent to about 5.17 francs per dollar. The present New York exchange is about 5.22. Please note that after January 1, next, the dues are to be reduced to 6.75 from 7.25 francs, the present dues. I have added the column of "Average gross tonnage per vessel" to show the present size of vessels. From its opening until 1872 the Suez Canal charged duties on the net tonnage as taken from the ship's papers. In 1872 they changed the basis to the gross tonnage, which led to the conference at Constantinople, which finally settled the Suez system of measurement. As at that time the Suez Canal Co. could not make necessary improvements or pay interest, they were allowed a surtax as shown, which was extra compensation and which was gradually to disappear. In addition to the foregoing the Suez charges, and always has charged, 10 francs, $1.94 per passenger, and for ships in ballast the tariff is 24 francs, or 48 cents, less than the above rate. There is an idea prevalent that the Suez measurement is the same as the Danube measurement, but this is not the case. The Suez Canal measurement uses only so much of the Danube measurement as provides for a means of estimating the ship's bunker capacity to be applied as a deduction from the gross tonnage. Apparently the owner of a ship with fixed bunkers may elect to have ship measured with bunker deductions either by the German rule or by the Danube rule. Please note the article of Mr. Baker in the Independent of November 16, of which, no doubt, you will receive a copy. It contains two errors. The measurement is not based on the Danube measurement of 65 cubic feet at all. The Danube ton is 100 cubic feet, the same as the English and American. The dues will not be 6 francs, but 6.75 after January 1, 1912. If you think it would be of any value I will prepare a short monograph on the Suez Canal measurements and the Constantinople convention, as I have a copy of the original proceedings of the convention which are in French. Very respectfully, EUGENE T. WILSON, [From New York Journal of Commerce.] The Suez Canal opened November 17, 1869. The average duration of passage last year was 16 hours 42 minutes, with electric light at night, and 26 hours 20 minutes without. In all, 4,533 vessels passed through the canal. The maximum draft of water allowed has been increased from 24 feet 7 inches in 1869 to 28 feet since 1908. The record of changes in the dues is as follows: November 17, 1869. Opened. Dues $1.94 per ton on net tonnage. July, 1872. Dues $1.94 on gross tonnage. April, 1874. Dues $1.94 with $0.582 surtax, net tonnage, Suez measurement. January 1, 1885. Dues reduced to $1.843. Vessels in ballast pay canal dues at $0.485 less than above rates. The growth of traffic and revenue from dues is as follows: SIR: I have a request from Mr. McIlvaine to prepare a short monograph on the Suez Canal convention at Constantinople. In my conversation with you you referred to the translation of the original proceedings. These proceedings are very long, about 225 pages of French, and the pages are about the size of ordinary legal cap, so it would take two or three months' time to complete it. I think it would be best to write a short history of the trouble which made the Constantinople convention necessary and then translate merely such portions as would throw light on the questions which are before us. A large part of the proceedings themselves is merely formal. In form they are similar to the Congressional Record and to the House journal combined. The formal parts have no present value. If this meets with your idea, please let me know at once and I shall take it up. The more I investigate this question the more I am convinced that the gross tonnage is the proper basis on which to levy the canal dues. It was the idea of the British Board of Trade before the Constantinople convention began that this was the best way, and also the idea of the British foreign office, of which the Earl of Derby was the head. It was, however, found utterly impracticable in the Constantinople convention to carry out the idea of gross tonnage as a method of measurement. Prince Bismarck absolutely refused to entertain the question of changing the German tonnage laws, as it would seem that he had had a good deal of trouble in getting them unified for the Empire. As the light dues, dockage dues, Danube navigation dues, and all other dues had been for so long a time based upon the net registered tonnage of a vessel, it was decided to make the net tonnage, with some modifications, the basis of measurement. The Constantinople convention met October 6, 1873, and adjourned December 18, 1873. The great question before the convention was to decide how many cubic feet should compose a ton, or "tonneau de capacite," and it was decided to adopt the ton of 100 English cubic feet, as contained in the British merchan's shipping act of 1854, as the unit of measurement. Then, having established this ton, the system of measurement came next, and the Moorsom system as embodied in the British merchants shipping act of 1854 was adopted as the base, The Moorsom system of measurement as contained in the British shipping act for the computation of gross tonnage is the same as that of the United States, France, Germany, Norway, and Sweden, and, I think, Italy and Spain. Moorsom had been secretary of a British commission which met in 1849 to propose a system of measurement, but Parliament did not adopt its report. He then proposed his method in 1850 and it was enacted into law in 1854. It has never been changed in England. The Moorsom task consisted of two parts: First, to find a geometric formula, or formulas, which would give accurately the internal cubic contents of a ship in cubic feet, and second, to adopt an arbitrary divisor as a unit ton of measurement which would not materially change the total tonnage of the United Kingdom, as it was a sine qua non that this tonnage should not be changed on account of its statistical value and on account of the fact that the British revenue to be derived from this tonnage by local tonnage taxation should not be materially changed. You will observe that the first part of the task would remove the inequalities and discriminations which would exist between ship and ship, and the second part would still retain the status quo which existed between the British Government and the entire total shipping of the United Kingdom. The Constantinople convention, therefore, adopted this system of measurement and this unit measurement ton of 100 English cubic feet. The next question in ship measurement was, What should be the deductions and what parts of the ships themselves should be included in the gross tonnage? Prior to 1854 it may be said generally that all tonnage measurement, both in England and elsewhere, had been based upon the relation between a circumscribed parallelepipedon to a ship's hull and the internal capacity of the ship. The English used for a long time pretty generally the length multiplied by the breadth multiplied by the depth, but later, in 1773, the length was diminished by three-fifths of the breadth and the depth was taken as half the breadth, so that the total capacity of the ship varied directly as the square of the breadth. Deck houses or small parts of the superstructure above the tonnage deck were not measured into the gross tonnage at all. The result of this rule was that they built very narrow, deep ships, which were unwieldy, and also covered the ships with deck houses which made them high out of the water. The underwriters and ship builders, and in fact the Government itself, were strongly opposed to any such style of naval architecture, and it was found necessary to find a rule for ship's measurements which would prevent not only this faulty construction of the hull but also prevent undesirable buildings as part of the superstructure. The Moorsom formulas, which are a modification of the Sterling formula for the determination of an irregular solid and of Simpson's formula for the determination of the area of a cross section of that solid, solved the first question, and the last was solved by measuring into the gross tonnage every part of the superstructure above the tonnage deck which was inclosed from wind and weather. The Constantinople convention followed this rule and system of measurement for gross tonnage, but in addition they measured in as part of the gross tonnage the hatch combings if they exceeded one-half of 1 per cent of gross tonnage, and also measured part of the poop and the forecastle in case the poop and forecastle were covered over but not entirely inclosed, as they would not allow a poop greater than 10 per cent nor a forecastle greater than 124 per cent of the length of the ship. This makes the Suez gross tonnage a little larger than the official or national gross registered tonnage. The next question was, What deductions should be made from the gross tonnage to determine the net tonnage? It was decided by the conference that all portions of the ship which are available for revenue, whether passenger or cargo, should be included in the gross tonnage of the ship. They allowed some of the deductions therefrom, therefore, which are allowed by the British merchants' shipping act and some they did not. These deductions included, among other things, chart room, room for officers and crew, room for the ship's watch officers, and room for the surgeon, but they did not and do not allow for de ductions for the captain's room, for the purser, nor for what we would call room occupied by steward's department, nor for kitchens for passengers, but do allow for kitchens for the crew. The system of deduction for engine-room space and coal bunkers, as contained in the British merchants' shipping act of 1854 and of our own shipping acts at the present, was not adopted by the Constantinople convention, and in my opinion should not be adopted here. It is this method of deducting for engine-room space that makes the large difference between Suez measurements and the National measurements. The British law and our law provides that where a screw ship has fixed bunkers, if the engine room and boiler room space and shaft alley are greater than 13 and less than 20 per cent of the gross tonnage, then 32 per cent of the gross tonnage shall be deducted from the gross tonnage. Our law, however, provides also that the owner may elect whether he will take this deduction or whether he will take the above space and deduct it and three-fourths of itself. The British law provides that if the engine-room space, etc., shall be greater than 20 per cent and less than 13 per cent, then 175 per cent of this space shall be deducted. This deduction of the engine-room space plus three-fourths of the engine-room space is the Danube rule. In 1860 the Danube commission adopted part of the Moorsom system of determining the gross tonnage, adopted it in entirety in 1870, and in 1876 adopted the Suez rules in their entirety. The Constantinople convention had before it two rules for determining the deduction of engine-room space. The first was known as the German rule, which provides that in ships of fixed bunkers the bunker space as it actually exists shall be deducted and no more. The second was the Danube rule, which provides for the deduction of the engine-room space plus three-fourths of the engine-room space. The convention decided, in fact, it was a compromise, that they would allow the shipowner to elect which method he would prefer, so that at the present time the shipowner can have his ship measured by deducting his engine-room space and his actual fixed bunker space, or he can have the engine-room space deducted plus three-fourths of the engine-room space, and it would be understood that this deduction of the engine-room space plus three fourths of the engine-room space was the only part of the Danube rule that was adopted by the Constantinople convention. The Moorsom system also provided a system of measurement to determine the net tonnage of ships when the ships were loaded and the holds were not accessible. This rule is based upon a formula containing the length, breadth, and girth, and a factor (0.0017). It is supposed to give the net registered tonnage in measurement tons of 100 cubic feet each. As ships have been growing larger and larger, the inequalities and discriminations between ship and ship have been constantly increasing, due to this Danube system of deduction of engine-room space, and herein when I speak of engine-room space it is to be understood that it includes boiler rooms and the shaft alley or alleys. In 1907 Great Britain passed an act providing that engine-room deductions should not exceed 55 per cent of the tonnage remaining after crew space, etc., had been deducted. The Germans deduct engine-room space up to 50 per cent of the gross tonnage, but no more. The Suez rules allow a deduction of not more than 50 per cent. The fast passenger ships with tremendous engine-room space and bunker space measured under the national rules may elect, subject to the foregoing limitations, if they exceed 20 per cent of the gross tonnage, to have deducted their engine-room space and three-fourths of the engine-room space, and the results are that the deductions are so large that a fast passenger boat has a great advantage over a slower passenger boat and a cargo boat. In fact, the Mauretania and the Lusitania, which are about 31,000 gross tons, have only about 9,000 net tons, and there are several ships, both in the Cunard fleet and the White Star fleet, and I have no doubt in the German and French fleets also, but their data are not accessible, which would pay much larger canal dues than the Lusitania and the Mauretania. The Mauretania is 31,938 gross tons and 8,948 net tons. The Cunard Line has four ships and the White Star Line has seven ships which have a larger net tonnage than the Mauretania. The largest of these ships is the Adriatic, which is 24,541 gross tons and 15,638 net tons. The Mauretania is 70,000 horsepower and has a rated speed of 24 knots. The Adriatic is 2,770 horsepower and has a rated speed of 18 knots. The cause of this difference is manifest. It is my view, following the ideas of the British Board of Trade and the British Foreign Office of 1873, that the gross tonnage is the best base for levying tonnage. If a shipbuilder desires to build a fast passenger ship and puts his money into engine room and coal bunkers, he should pay for it. If he desires to build a cargo ship he should not be placed in a disadvantage. To my mind the object of this canal should be to attract cargo rather than passengers. We are building a highway of commerce in competition with our own internal railway system. A great many sections of our country have grievances against the railroads in the matter of freight rates. Some of these grievances in the past have unquestionably been just, but in my opinion we have no general grievances against our own railroads in the matter of passenger rates. The transcontinental passenger rates and the intermountain-Atlantic seaboard passenger rates are exceedingly reasonable and have been reasonble for may years. We, therefore, should ecourage no system of levying tolls through this canal which would tend to break down our splendid railway passenger service, especially when it is recognized by all transportation experts that the passenger service for railroads is not especially remunerative. The Constantinople convention took things as they found them. They found ships that were already built and had been used for three years. They were no doubt ships which had been especially built for the Suez traffic. They met at a time when these rates had just been raised by the Suez Canal Co. by a change in the measurement, and it would have worked great hardship to have materially changed the system of measurement at that time or to have changed conditions under which shipowners had been for a long time operating and which they had a reasonable right to expect would continue when they went into that trade. No such conditions confront us. Not a single passenger ship has ever been built so far with a view to going through the canal. No ships of any kind other than pure freighters will probably be built for going through the canal until the question of dues is permanently settled, and in my opinion these dues should be so arranged while it is yet time, so that passenger-traffic conditions within the continental limits of the United States would not be changed. If this unit of gross tonnage for the basis of measurement be adopted, the remedy as pointed out by the British foreign office is simple, and that remedy is a reduction in the rate. It is essential that any system of measurement that we adopt should be one which is simple and one which can be taken directly from the national papers with which the ships are provided, if possible. The national papers of all maritime countries of which I am now aware have on them expressed either in English cubic feet or in meters the amount of the gross tonnage. I fear perhaps that I have digressed in this a little from the original purpose of the letter, which was to inquire as to the monograph on the Suez Canal convention. Please let me have your answer as soon as convenient, and I shall take the matter up. Very respectfully, EUGENE T. WILSON, EXHIBIT E. CRISTOBAL, December 9, 1911. The CHAIRMAN, ISTHMIAN CANAL COMMISSION, Culebra, Canal Zone. SIR: In my letter to you of November 25 I gave you some data in reference to the history of the Suez Canal, and in my letter of December 5 I gave a short résumé of the conclusions of the Constantinople convention of 1873; and I pointed out to you in a brief way the advantages of using the gross tonnage as the basis for the levying of canal tolls over other systems. Herein I shall go more into details than I did in the above-mentioned letters. The original concession for the Suez Canal was granted by the Khedive to Mr. Ferdinand De Lesseps on the 30th of November, 1854. It was very general in its language and provided that it should run for 99 years from the date of the opening of the canal, and provided that the net revenue of the canal should be distributed, after paying all expenses-75 per cent to the stockholders, 10 per cent to the promoters, and 15 per cent to the Egyptian Government. In order to float a company, it was found that a more definite charter was required, and on January 5, 1856, a charter going more into detail was granted by the Khedive. It provided, among other things, that the company should, first, levy tolls without discrimination or favor on ships in similar conditions; second, publish its tariffs three months before they went into force in the capitals and principal commercial ports of the countries interested; third, the tolls should not exceed for the said privilege of navigation a maximum figure of 10 francs per ton of capacity (tonneau de capacité) and per head of passenger. It finally provided that the concession should be confirmed by the Sublime Porte. This concession and the whole project was violently opposed in England, not only by the Government itself, but by a large part of the British press. Lord Palmerston, in the House of Lords, called it "a dream," a visionary scheme," 66 and "a bubble." Others were equally violent. England opposed the confirmation of the concession by the Sublime Porte by every diplomatic means in her power, and, in fact, was able to prevent the ratification of the concession until March 8, 1866, when it was confirmed by the Sublime Porte, long after work had actually begun and when it was seen that the work had gone so far that there was no use endeavoring to stop it. The canal was opened in November, 1869, and for several years did not pay dividends. Its estimated cost had been 200,000,000 francs, and this was obtained by floating 400,000 shares of 5 per cent preferred stock, 500 francs per share-say, $40,000,000. It cost over twice this amount before it was opened, and did not pay interest for the first few years. These shares were as low in 1871 as 163 francs, and in the beginning |