It was a pity, sir, it seems to the Chamber of Commerce of Philadelphia, that the English Government started any contention as to the regulations that were made by the United States. It would have been very much better if they would have accepted them and claimed that they should have the benefit of them in their entirety. It would have been well if instead of continuing that contention in our note we should have said to the foreign office in London: "In your note you have entirely misconstrued our contention. The canal is for the use of vessels of all nations upon equal conditions and charges. Come and use the same upon this basis." If our country should have met them in this spirit we would have secured first, the reputation of broad and generous honesty; second, we would have secured the most effective means of cheapening the freight charges between the east and west coasts; third, the most effective method of controlling shipping combines through the canal; and, fourth, the retaining of a large part of the coast to coast business, which otherwise will be lost to foreign nations on account of the high freight in American bottoms. In order that foreign vessels shall bear charges similar and of equal amount to those imposed upon vessels built and operated under American laws in the coast-to-coast business, it will be necessary to handicap them (that is, the foreign vessels) by a fee equal to the extra cost of construction of the American vessels in American shipyards and the cost of operation under navigation laws. This is about 18 pence per ton. The rate of freight in American bottoms, coast to coast, is at present-I am speaking as if the Panama Canal were open-$7 to $8 a ton from England to San Francisco, or from New York to San Francisco in foreign bottoms the rate would be from $4 to $4.50. If there is any question of 2 shillings being a too moderate handicap, there can be no question that 3 shillings a ton will be more than enough to protect the construction and operation of American vessels under our navigation laws. It will give them about 60 to 100 per cent protection. There is no doubt that American shippers would be glad to save the 2 to 3 shillings difference in freight between the American and foreign bottoms and absorb this 3 shillings per ton, or that a foreign bottom in an American port would absorb the same rather than seek cargo in a Mexican, Canadian, or other foreign port. It is a self-evident fact that the difference in freight rate of $2 to $3 a ton will cause buyers in this country to make their purchases from foreign nations rather than to give them to merchants in the United States. This solution of the question will keep entire faith with all nations and permit the trade between the east and west coasts to continue instead of diverting it to foreign business.

That, in substance, sir, is the condensation of our thoughts and resolutions which we passed.

The CHAIRMAN. We are very much indebted to you, Mr. Wood, for presenting them. Is there anything else?

Mr. Wood. I should like to add this, Mr. Chairman, that I think it is evident to everyone that if an iron man on the Delaware River was competing in San Francisco for a cargo, it would be impossible for him to secure that contract on the Pacific coast as against a foreign bidder, because he would have to pay from $2 to $3 a ton more freight to carry his goods to San Francisco than the Englishman would carrying his goods from England to San Francisco.

The thought also that I wish to leave clearly before the committee is this, that if there was a fee

Senator WALSH. Is that because you would have to ship in the American bottoms?

Mr. WOOD. Yes, sir.

Senator WALSH. The other ship would carry them much cheaper? Mr. Wood. Yes, sir. The other point I wish to leave prominently in the minds of the committee is this, that if the Government charged a fee for the foreign vessels using the canal as the American vessels do-that fee being in order to put it under the same conditions and charges as the American vessels that fee would only protect and close the mouth of any shipbuilder in this country, because he would be amply protected, and would also close the mouths of any ship operators in this country, because such a fee would amply protect the operation of the vessel.

Senator BRISTOW. You would have that fee in the shape of a toll, would you?

Mr. WOOD. Call it toll or call it anything else. If an English captain was in New York and wanted his vessel cleared to San Francisco, I should have him put down his 2 or 3 shillings that called for his clearings and let that 2 or 3 shillings a ton go into the United States Treasury, that being the best place for it to be eventually absorbed.

Senator BRISTOw. So you would let the foreign built and operated ships handle commerce between the American ports by paying a certain fee for that privilege?

Mr. Wood. The coast-to-coast ports in which they used the Panama Canal.

Senator BRISTOw. And you would fix that at 3 shillings a ton? Mr. Wood. I am only doing that so as to stop any criticism of a shipbuilder or a shipowner.

The CHAIRMAN. Mr. Wood, the Philadelphia Chamber of Commerce passed resolutions some time since approving the exemption to coastwise vessels from the payment of tolls going through the canal, did it not?

Mr. Wood. It did, sir.

The CHAIRMAN. What was the date of the passage of those resolutions?

Mr. WOOD. I think the first resolutions that were passed were 8 or 10 months ago; I have forgotten the date. This is a reaffirming of those resolutions, sir.

The CHAIRMAN. A reaffirming? Do you not recommend by these resolutions the imposition of a toll on the American shipping going through the canal?

Mr. WOOD. I regret exceedingly, sir, that I have not made myself understood.

The CHAIRMAN. What is the answer to that inquiry?

Mr. WOOD. No, American vessels go through the canal free, and then vessels of all nations have the same privilege when they load themselves with the same charges as American vessels are loaded with. Senator BRISTOW. The difference in his view, if you will excuse me, is that he would let the foreign vessel and the American vessel both that are engaged in the coastwise trade go through the canal free, but

in order to enable the foreign vessel to engage in the coastwise trade he would have it pay a fee for that privilege.

The CHAIRMAN. Three shillings a ton?

Senator THOMAS. In other words, it would go through free, only it would not?

Mr. Wood. Handicapped by the same charges; going out under the same conditions the American vessel does.

Senator THOMAS. Plus 3 shillings?

Mr. WOOD. No, not plus, because the American has paid his 3 shillings a ton when he has built and operated.

Senator SIMMONS. Mr. Wood, I do not understand your resolution. The Philadelphia Chamber of Commerce has placed itself on record as favoring free tolls on vessels plying solely between coast to coast ports of the United States. That is not the present law. It is not confined to vessels plying solely between coast to coast. It applies to all vessels engaged in the coastwise trade.

Senator CHILTON. And that embraces Porto Rico and Hawaii.
Senator SIMMONS. What do you mean by this?-

The Philadelphia Chamber of Commerce has placed itself on record as favoring free tolls on vessels plying solely between coast to coast ports of the United Statesthe Philadelphia Chamber of Commerce regards the solution of the Panama Canal tolls a question of honor, and calls upon the Congress of the United States to take no action that may be construed as an infringement of national honor, but gives the vessels of all nations the same advantage that are accorded American vessels under similar conditions and charges.

That looks like free tolls, but that if there is any question about its keeping faith under our treaty you do not want free tolls.

Mr. WOOD. Pardon me, sir, the thought is this: That the free tolls should be accorded to vessels if they are accorded American vessels; free tolls, if they are accorded to American vessels, should also be accorded to foreign vessels under the same burden, which place themselves under the same burden as the American vessels are under.

Senator SIMMONS. That is your position, then. If we accord free tolls to American vessels we ought to accord the same privilege to foreign vessels?

Mr. Wood. Who are willing to put themselves under the same burdens as the American vessels are put under by our laws. Senator SIMMONS. I see your point.

Senator BRISTOw. I understand you are a heavy shipper, Mr. Wood. What influence will tolls have on the American coastwise traffic if they are imposed?

Mr. Wood. If tolls are imposed upon the coastwise traffic it will tend to stiffen the railroad rates, sir.

Senator BRISTOw. Will $1.25 a ton materially affect the shipments via Panama if it is charged or not; that is, if it is not charged will the traffic be much heavier, do you think, by water than otherwise? Mr. WOOD. Senator, you are asking a question that is very difficult to answer yes or no, because traffic does not go altogether by rate, it goes largely by location. In other words, it is governed, of course, primarily by charges, but those charges then have to be worked into where the man's works are situated; how far distant the port he sends, because it is not 40 cents

Senator BRISTOw. Forty cents on what?

Mr. Wood. The $1.25 rate sir, is $1.25 of measurement tonnage, which is about 40 to 50 cents on the ton as we ordinarily think of it. Senator BRISTOW. That would be on a ton of pipe?

Mr. Wood. The real weight.

Senator BRISTOW. That would depend entirely on the cargo, would it not? If it was on hops it would be very much more than $1.25, would it not?

Mr. WOOD. A vessel owner considers, I believe, sir, that he is sending his vessel to sea improvidently if he does not have about 120 to 150 per cent of her tonnage aboard of her. Mr. Thomas, may I make that clear?

Senator THOMAS. So far as I am concerned you may.

Mr. WOOD. But it is a fact, nevertheless.

Senator BRISTOW. Again the rate on hops would be very much more than the rate on iron or wood, would it not?

Mr. Wood. The steamship regulates that by measurement, sir, and by charges.

Senator BRISTOw. Yes, of course it is so much per 40 cubic feet, but the 40 cubic feet of hops would not weigh 1 ton at all, nor anything like a ton, and so the shipper of hops would probably pay in transporting an actual ton of merchandise three or four times the price of a ton, would he not?

Mr. WOOD. The fact that 40 cubic feet of hops does not make a ton is made up in the charges.

Senator BRISTOW. In the charges on the hops?

Mr. WOOD. In the charges on the hops, and the way the shipper gets his extra weight is to put in some solid cargo like iron, which enables him first to load his vessel with say, feathers, which do not sink her, and then put enough iron to bring her down to her plimsoll lines, and between the two gets about 130 to 140 per cent of her tonnage.

Senator SIMMONS. I understand you to say that you are engaged in the iron pipe business?

Mr. WOOD. Yes, sir.

Senator SIMMONS. Suppose you wanted to ship your iron pipes to the Pacific coast. How much will 40 cubic feet of iron pipe weigh? Mr. Wood. The question is iron pipe between dead weight and measurement tonnage; at about 10-inch diameter it will go by measurement, and below that by dead weight.

Senator SIMMONS. At the rate of $1.25, in order to make myself a little clearer, a net ton, ascertained by the measurement basis, how much would it make on a ton of iron pipe going through the canal weighing 2,000 pounds?

Mr. WOOD. If the tolls were imposed?

Senator SIMMONS. Yes; if the tolls were imposed.

Mr. Wood. It would make, sir, about 40 or 50 cents.

Senator SIMMONS. If these tolls are needed, you could send what we ordinarily call, in common parlance, a ton of iron pipe to the Pacific

coast for 40 cents a ton less?

Mr. Woop. Yes, sir.

Senator SIMMONS. That is, the boat could take it there for 40 cents less a ton of 2,000 pounds?

Mr. WOOD. Yes, sir.

Senator SIMMONS. How much of that 40 cents do you think the consumer over on the Pacific coast would get?

Mr. Wood. He would get 40 cents, sir.

Senator SIMMONS. Do you think he would, or would the railroad keep it?

Mr. WOOD. No; it would not go to the railroad.

Senator SIMMONS. Or to the steamship company, I mean?

Mr. WOOD. It would not go to the steamboat, because the competition amongst the four or five shippers of cast-iron pipe to get that contract would include crossing off of their cost that 40 cents they would want to get back.

Senator SIMMONS. You think that 40 cents a ton

Mr. WOOD. Would be ground up by competition.

Senator SIMMONS. You think that would be some benefit to you? Mr. WOOD. Decidedly, because it would enable us to have that better opportunity with our European competitors.

Senator SIMMONS. I understood you, Mr. Wood, that you were afraid that foreign vessels would get a large part of our coastwise trade because on account of the high price charged by our coastwise trade, freight rates charged by our coastwise trade, the difference upon a cargo from abroad to the Pacific Coast would be from Philadelphia to the Pacific coast something like $4 a ton, you say?

Mr. WOOD. No; around between $2 and $3 difference, sir. That is, you could transport iron products, coal and heavy stuff from England to San Francisco in English bottoms at a rate not far different than from Philadelphia to San Francisco in English bottoms, while for American bottoms our charges would be $2 to $3 in excess of that, which would throw the San Francisco trade to England.

Senator SIMMONS. Exactly. Then you have for the first time. to-day fixed the difference between the coastwise rates and foreign rates. In your line of business, at least, there would be a difference. The coastwise vessels under the present law would charge about $2.50 a ton more to take it from Philadelphia to San Francisco than a foreign vessel would charge to take it direct from Europe through the canal to San Francisco?

Mr. WOOD. The amount in dollars and cents is most moderate, at the distance.

Senator SIMMONS. Most moderate?

Mr. WOOD. Most moderate.

Senator SIMMONS. It is $2.50 a ton more by our coastwise steamers than by foreign steamers?

Mr. WOOD. Our coastwise steamers hardly exist

Senator SIMMONS. What is the difference in the distance?

Mr. Wood. The difference in the distance would be roughly 2,000 miles.

Senator SIMMONS. In favor of-

Mr. WOOD. New York. I am giving it roughly, sir.

The CHAIRMAN. You say the coastwise ships barely exist. I want to hear the rest of your sentence.

Mr. WOOD. I said that the coastwise vessels for cargo shipments hardly exist. If I should ask my shipper how many there were of course, a small concern like ours is not like the Steel Trust, or anything like that, with their complete data on file-but I should suppose his answer would be that there are about 6 to 10 ships that are avail