Mr. WHEELER. I think I have run the gamut. If you think I can throw any more light on the subject I will be glad to answer any question.

The CHAIRMAN. The committee is obliged for the light you have shed on the subject.

STATEMENT OF MR. WILLIAM MITCHELL BUNKER, A DIRECTOR OF THE SAN FRANCISCO CHAMBER OF COMMERCE.

Mr. Chairman and gentlemen, my remarks simply deal with certain economic features.

The CHAIRMAN. You are not concerned with shipping or interested in shipping, directly or indirectly?

Mr. BUNKER. Neither.

In 1899 I studied the Trans-Siberian Railway and the resources of eastern Siberia at the instance of the San Francisco Chamber of Commerce, with a view to learning the effect of the railway and the effect of wheat culture in eastern Siberia on the oriental demand for Pacific coast products.

There was a general belief at that time that the Trans-Siberian Railway would create a new current of trade from Europe to the Orient and that wheat grown in eastern Siberia would drive Pacific coast flour from the oriental market. I found that the TransSiberian Railway was a negligible factor in oriental trade and that eastern Siberia was not adapted to the successful growth of wheat. Water transportation between the Occident and the Orient maintained its supremacy and has continued to maintain that supremacy. The San Francisco Chamber of Commerce favors the free passage of American ships in the coastwise trade through the Panama Canal for a variety of reasons. In any event, the shipments of California products to Europe will largely increase, through the reduction in the ocean passage between San Francisco and European ports by several thousand miles and the resulting decrease in freight rates. But as a rule the home market is the best market, best for the producer and best for the producing country. This point is partially illustrated by the working of the national irrigation law. In advocating that law as the representative of the San Francisco Chamber of Commerce, I took issue with eastern opponents of the law, who said that the Pacific coast producers would be the sole beneficiaries of the national irrigation enterprises, and that the land brought into use by irrigation would lessen the value of eastern farming lands. I claimed that the irrigation enterprises would call for machinery made in the Eastern States and would lead to intensive cultivation and in various ways increase the home market for the manufactured products of the East. To date over $60,000,000 have been spent by the Government on irrigation enterprises. Over $2,000,000 have been spent by the Government for machinery and other manufactured articles. The bulk of this money has gone to Pittsburgh manufacturers.

The larger the population on the Pacific coast the greater the home market for the manufactured products of the Eastern States. And of course the Panama Canal will make the Pacific coast easily and cheaply accessible to the European immigrant.

The immigrant from Hamburg to San Francisco via New York now pays at the rate of $103.25, of which $38.50 goes to the steamer

and $64.75 to the transcontinental railway. This rate is not affected by the special colonist rate of $48 from New York to California. The through immigrant rate from Hamburg to San Francisco is not expected to exceed $50, and may be a little lower. The large increase in immigration will furnish the Pacific Coast States with the farm labor they so greatly need, increase the food and other products of the coast, and assist in solving the food problems of the Eastern States. According to the Bureau of Labor bulletin, the price of foodstuffs in this country increased 53.8 per cent between 1896 and December, 1910. While the wheat product rose from 467,102,947 bushels in 1896 to 635,121,000 in 1910, the percentage of domestic product exported fell from 27.07 per cent in 1896 to 13.76 per cent in 1910, and in 1911 touched the low level of 11.16 per cent. According to this showing the home demand for wheat has steadily increased and is steadily increasing. Forty million people living in the Eastern States have a consuming interest in foodstuffs, and are entitled to whatever benefits may accrue to them through an economic use of the canal; that is to say, a use of the canal that will make for cheap transportation between the coasts. The free passage through the canal of American ships engaged in coast wise trade will therefore help to solve the foodstuff problem of the Eastern States.

Since 1862 the acreage of California, for instance, in Indian corn, wheat, rye, oats, barley, hay, and potatoes has increased from 914,788 acres to 4,832,995 acres. The number of farms has increased from 72,542 in 1900 to 112,000 in 1910. Through the subdivision of large tracts of land the ratio of increase is greater now than ever before. I simply refer to these facts to indicate the increase of farms in one Pacific coast State. The five great valleys of the State, containing nearly 40,000 square miles of territory, are as yet sparsely settled, and 16,000,000 acres of fertile valley land await reclamation from the desolation due to riotous rivers. My main point is that the increase in the price of foodstuffs is a warning that should be heeded by those who are about to determine the actual value of the Panama Canal to the American people. The canal toll will figure in the cost of transportation. The cost of transportation will partially determine the final price of the transported foodstuffs and other products. In the last analysis the free passage of American coastwise ships through the Panama Canal will make available the foodstuffs and other l'acific-coast products needed in the East, and at the same time will increase the Pacific-coast demand for the manufactured products of the Eastern States. There is an interdependence of interest that can not be evaded.

The CHAIRMAN. Does any member desire to question Mr. Bunker? Mr. SABATH. I desire to ask him one or two questions. I notice you lay great stress upon the reduction of the rates between this country and Europe-we will say Liverpool and San Franciscopertaining to immigrants?

Mr. BUNKER. Yes.

Mr. SABATH. Is it the desire of California to secure immigration? Mr. BUNKER. It is. We certainly do desire that.

Mr. SABATH. I was under the impression that California was very much opposed to immigration.

Mr. BUNKER. What immigration-Chinese?

Mr. SABATH. Outside of the Chinese.

Mr. BUNKER. I can assure you that you are very much mistaken, and I will give you the economic reason. It is that there is not enough labor for the farms, and it has happened not occasionally, but often, that the fruit has had to rot on the trees because they could not pick it. They had to wait and let it drop.

Mr. SABATH. And that is due to the fact that you have not enough labor there?

Mr. BUNKER. Farm labor.

Mr. SABATH. Then you do not need a great many learned gentlemen and gentlemen of culture in California; what you need is labor. Is that right? I mean men to do that work.

Mr. BUNKER. We do.

Mr. SABATH. And it matters not whether they are capable of writing great essays and reading extraordinary articles, so long as they are capable of doing the work that you need them to do on farm and field?

Mr. BUNKER. And being good citizens.

Mr. SABATH. And being good citizens. That kind of immigrants you need and desire. Is that right?

Mr. BUNKER. We do desire them.

Mr. SABATH. And you would welcome them to your State?

Mr. BUNKER. We would welcome them to our State. We would be very glad to get them, and we are trying to get them all the time. Mr. SABATH. Have you room enough for them there? Is there enough land for them to cultivate?

Mr. BUNKER. I dislike to say anything about the State of California because a Californian is usually very timid and shy in that respect. [Laughter.]

The CHAIRMAN. Can you entice them from Chicago and other crowded eastern cities to your State?

Mr. BUNKER. In answer to Mr. Sabath's question, I will repeat what I said before, that the five great valleys of the State, containing nearly 40,000 square miles of territory, are as yet sparsely settled, and 16,000,000 acres of fertile valley land await reclamation from the desolation due to riotous rivers.

As to the enticing of people from these eastern cities, the idea prevails in California that when the canal is opened they will move that way of their own volition.

The CHAIRMAN. I wish to disclaim any idea of speaking disrespectfully of these people. They are good people, but they are congested in these large centers of population where they have not the amplitude of space and opportunity to do as well as they would have in that great open country. It seems to me that you would do them a great service as well as populate your State if you could persuade a large number of them to give up their present places and go out to California.

Mr. SABATH. They are doing it gradually. They are penetrating this great western country of ours.

Mr. BUNKER. Our theory is that there will be another stream of immigration from Europe, and that stream of immigration coming directly through the canal will largely relieve this very unpleasant and suffocating congestion in the large eastern cities of which you speak.

Thereupon the committee adjourned.

STATEMENT OF MR. H. H. RAYMOND, VICE PRESIDENT AND GENERAL MANAGER OF CLYDE STEAMSHIP CO. AND MALLORY STEAMSHIP CO.

JANUARY 19, 1912.

The CHAIRMAN. You may proceed, Mr. Raymond.

Mr. RAYMOND. I have not any statement to make, Mr. Chairman. I am interested in this subject, and I was just passing through the city and decided to attend the hearing.

The CHAIRMAN. Where are the headquarters of your company? Mr. RAYMOND. New York.

The CHAIRMAN. Is it an American company?

Mr. RAYMOND. Yes, sir.

The CHAIRMAN. How many ships do the two lines operate?

Mr. RAYMOND. About 43.

The CHAIRMAN. What is the average tonnage?

Mr. RAYMOND. About 4,000-2,500, I should say.

The CHAIRMAN. Net?

Mr. RAYMOND. Net.

The CHAIRMAN. Between what ports do you operate your ships? Mr. RAYMOND. From New York to Philadelphia; New York to Wilmington; New York to Charleston; New York to Brunswick, Ga.; New York to Jacksonville; New York to Key West; New York to Tampa, Fla.; New York to Mobile; New York to Galveston; Boston to Charleston; Boston to Jacksonville; Philadelphia to Norfolk and Newport News and bay points.

The CHAIRMAN. You do a general freight and passenger business? Mr. RAYMOND. And from New York to Santo Domingo.

The CHAIRMAN. Do you do a general freight and passenger business with all those ships?

Mr. RAYMOND. Yes, sir.

The CHAIRMAN. Do they keep you busy?

Mr. RAYMOND. We try to keep busy.

The CHAIRMAN. You have a fairly good business?

Mr. RAYMOND. Not exceptionally good. The owners of that property have never received any unusual or abnormal dividends; they have managed to pay their bills.

The CHAIRMAN. Are you building any new ships?

Mr. RAYMOND. We built three last year; we are building two now. The CHAIRMAN. How large are they?

Mr. RAYMOND. The ones we built last year were 5,000 ton boats; the one that is building now depends on the measurement afterwards; she will be somewhere between six and seven thousand tons.

The CHAIRMAN. Most of your ships would be large enough to do business through the canal, if you could find inviting opportunities in the Pacific Ocean, I presume, would they not?

Mr. RAYMOND. Some of them.

The CHAIRMAN. I believe it has been stated 4,000 tonnage is as small as could be economically operated through the canal. I do not know how true that is.

Mr. RAYMOND. As a practical man, I should say not less than that, and it would be better to be more.

The CHAIRMAN. With those preliminary statements, if there are any words of comfort or any assistance that you can give this committee affecting this legislation I would like to have it.

Mr. KNOWLAND. Have you given the question of tolls any study? Mr. RAYMOND. Very little. My attention was directed to these matters by the newspaper columns and the introduction into this subject of free ships for the coastwise trade, and other things like that that did not appeal to me as right.

Mr. KNOWLAND. Would your company probably utilize the Panama Canal?

Mr. RAYMOND. They are making some study of it.

Mr. KNOWLAND. Would the remission of tolls be an incentive? Mr. RAYMOND. Decidedly so.

Mr. KNOWLAND. It would be a great factor as to whether you took advantage of it or not?

Mr. RAYMOND. I do not believe-yes; to answer your question directly; yes.

Mr. KNOWLAND. Where would your trade probably be, through the canal? Have you given that any study?

Mr. RAYMOND. Well, I can not answer that, because we are a private concern, you know-no railroads interested with us and while we have been making some study of the west coast of South America trade and some little study of the canal generally, we are not prepared to say what points we would operate to, if any.

Mr. MARTIN of Colorado. You have studied the west coast of South America?

Mr. RAYMOND. I say that we have made some investigation of it. Mr. MARTIN of Colorado. Was that based on the theory that there would be a greater development from the opening of the canal to the west coast of South America than to the west coast of North America?

Mr. RAYMOND. No. We are in the steamship business for transportation, and it is the duty of those that manage the property, as I view it, to keep informed, and it is only as a matter of information that we are looking into this question at all, not with any definite view of engaging in it at once.

Mr. MARTIN of Colorado. But, agreeing entirely with what you say, what caused your investigation of the west coast of South America rather than the same coast of North America?

Mr. RAYMOND. That is a matter I would prefer to answer to the directors of my company and not to a public committee.

Mr. MARTIN of Colorado. My opinion will not change destiny any, but it has looked to me all the time whenever I thought of the map that it will be the west coast of South America and not of North America that will be the beneficiary of the Panama Canal. I just wondered if that was so. Your company investigated that field? Mr. RAYMOND. I can not say.

Mr. MARTIN of Colorado. You are not engaged in foreign trade at all except to Santo Domingo?

Mr. RAYMOND. The lines I direct and manage only engage in the domestic trade, but I am a director in one or two other companies that do engage in the foreign trade.

Mr. DRISCOLL. If there were no tolls, that would not apply to trade between New York and the west coast of South America?

Mr. KNOWLAND. Not unless we provided that it should only affect the coastwise business. If it applied to all ships flying the American