Selling Out

The plans of the Shipping Board for handling the 1,400 Government-owned merchant ships were finally made public. Following a two-hour conference with President Harding a formal statement was issued outlining a policy for the next year. The Board is faced by a difficult situation. Without the Ship Subsidy, the operation of American vessels is unprofitable. On this account there is little market for Government ships. The present system of "allocating operations under managing agents" (i. e., turning ships over to private operators, the Government guaranteeing a necessary return) involves an annual loss of about $50,000,000. Nearly 30% of the Government tonnage is composed of obsolete ships which will probably be scrapped as soon as the committee making a survey of each ship turns in its report. The Board will take the following action: Ships will be organized into some 20 definite foreign trade lines of advantage to American commerce and these lines and ships will be offered for sale (at something under the market price, if necessary), provided the new owners will continue these routes. The unrestricted sale of Government ships at market prices will continue. The Government will not, however, sell its ships at a great sacrifice. It will not "sell three or four cream routes," leaving itself " holding the bag as to the rest" and it will not leave the seas to foreign competition. Chairman Albert D. Lasker of the Shipping Board admits that the prospect of selling the ships on these terms is poor, but says: " The bids for the next 60 days will tell the story." If this scheme of sale fails--as Shipping Board and ship owners seem to expect--the Board has committed itself to direct operation of its own ships. The Board has an appropriation of $50,000,000 for the next year which it may so employ. " Nobody hates Government ownership and operation more than I do," said Mr. Lasker, "but I and the Board have finally recommended, in view of the present situation, that we cut out doing business on cargo lines through agents and go direct on a larger scale to Government operation."