Mr. SIROVICH. What is the reason for that increase? Is it due to the colonization by Japan on the western coast of South America?

Mr. SAUGSTAD. I have no knowledge of that, sir. There is some increase in high speed and higher class tonnage going in there, which may have some bearing on it.

Mr. SIROVICH. It seems to have doubled.
Mr. SAUGstad. Yes, sir.

I think, Mr. Chairman, that it might be well to include a tabular statement of the ordered services of Japan, as published by the Japanese Department of Communications. This includes 31 lines, 9 of which extend beyond Asiatic waters to the United Kingdom, Australia, North and South America, Africa, and the Near East and Habana. This tabulation, as published in official Japanese sources, covers the lines, the number of vessels and gross tonnage, and the speed of each, on each line, the frequency of sailings, the duration of the contract, and the contracting company.

The CHAIRMAN. Without objection it will be inserted in the record. (The table is as follows:)

Torta

Shipping services ordered by the Japanese Department of Communications

Once or more every fort. April 1934 to March Nippon Yusen Kaisha.
night.

1935.
Yokohama-Melbourne Line.. 3; over 5,000 tons; over 15 knots.

do.

Do.
North American service:
San Francisco Line..
3; under 15 years; 13,000 to 14,000 tons; 18-20 knots. Once or more every 4 weeks. January 1930 to De- Do.

cember 1934.
Seattle Line..
3; under 15 years; 11,000 to 12,000 tons; 17-19 knots. Once or more in 3 weeks.. January 1934 to De- Do.

cember 1934.
South American service:
West Coast Line..
3; under 15 years; 7,000 to 9,700 tons; 14-16 knots.. Once or more in 2 months.. Jan. 1, 1930, to De- Do.

cember 1934.
East Coast Line..
5; under 15 years; 7,000 to 9,600 tons; 15-17 knots. Twice or more in 3 months.. ..do.

Osaka Shosen Kaisha.
African service: East Coast Line. 5; under 25 years; over 9,000 tons; over 15 knots..

Once or more a month... April 1934 to March Do.

1935. South Sea service: Java Line. 4; under 20 years; over 3,500 tons; over 13 knots.

Once or more every 3 weeks. do.

Nanyo Yusen Kaisha.
China coast service:
South Line..
2; under 15 years; over 2,000 tons; over 12 knots.

do.

Nisshin Kisen Kaisha.
North Line ----...
.do..

.do.

Do.
China service:
Shanghai-Hankow Line.
4 or more; over 2,000 tons; over 12 knots.

10 times or more a month. April 1934 to March Nisshin Kisen Kaisha.

1935.
Hankow-Ichang Line.
1 or more; over 1,500 tons; over 11 knots.

do.

Do.
Hankow-Changsha Line.
1; over 800 tons; over 9 knots....
Twice or more a month 1 ..do...

Do.
Hankow-Changteh Line..
1; over 800 tons; over 9 knots...

.do.
Ichang-Chungking Line.
2; over 500 tons; over 14 knots in summer-2; over 250 tons; 4 times or more & month 1. do.

Do.
over 11 knots in winter.
Dairen Line..
4; 3 of them under 20 years; over 5,000 tons; over 15 knots. Twice or more a week.

do.

Osaka Shosen Kaisha.
Nagasaki-Shanghai Line.
2; under 15 years; over 5,000 tons; over 20 knots.

Once or more every 4 days. do.

Nippon Yusen Kaisha. Yokohama-Shanghai Line.. 3 vessels.

do.

Do.
North Ching service:
Kobe-Tientsin Line..
3; under 15 years; over 1,500 tons; over 12 knots.

Once or more a week. April 1934 to March Kinkai Yusen Kaisha.

1935.
Yokohama-Newchwang Line.. 3; over 1,500 tons; over 12 knots.

_do.
Yokohama-Tientsin Lino... 2; 1 over 1,500 tons; over 12 knots--the other over 1,200 tons; 40 times or more a year.

do
over 10 knots.
Tsingtau Line.
3; over 3,000 tons; over 13 knots.

Nippon Yusen Kaisha,

Osaka Shosen Kai-
sha, Harada Risen

Kaisha.
Sea of Japan service:
Tsuruga-Vladivostok Line.......... 1; over 2,000 tons; over 13 knots.

3 times or more a month.. _do.

Kitanihon Kisen Kai

sha. Tsuruga-North Korea Line........ 1, over 3,000 tons; over 12 knots...

do.

Do,

do

Kinkai Yusen Kalsha.

1 Provided that in the period during which the water of the river is diminished, the navigation may be suspended or the regular service decreased. • Provided that during the winter the navigation may be suspended.

Mr. SAUGSTAD. I might say, as a general statement, on the whole system that only two lines are considered as mail lines--the line from Yokohama to London, and the line from Yokohama to Melbourne, Australia.

Mr. Sirovich. What did you mean by that last statement?

Mr. SAUGSTAD. The other day, Mr. Congressman, we referred here to the general principles of mail subsidies; and I, at that time, made the statement that, so far as I know, among the principal maritime nations of the world today there are only six contract services or group lines which were officially called mail services, outside of our own system in this country. I referred to 4 British and the 2 Japanese. That is, the British packet service, the Far East, American and others that we cited, plus 2 of the Japanese system, that go to London and to Australia. In other words, the Japanese Government does not consider the rest of its contract services as based on the mail to be transported.

Mr. SIROVICH. But on these lines between Yokohama and London and between Melbourne and Yokohama, the Japanese Government considers the subvention that they pay there as a mail subsidy? Is that it?

Mr. SaugsTAD. That is apparently so, from the latest information that we have on it; and I might say that the information on the Japanese system of services is not altogether very complete. The so-called "mail services” were a post-war development. In 1920 and 1921 the Japanese Diet made a provision for a system of postal payments, to be applied to the European and Australian lines and the line to Seattle, all served by the N. Y. K.

It is stated that the contracts of this company with the Government during the period of the World War prevented the company from taking advantage of the high freight market then prevailing, and, also, that the company proposed to the Government the high mail-pay principle, with reduction of Government supervision over the commercial operations of the company. Accordingly the mail payments were then established on a basis known as “measurementmileage basis”; that is, measurement of space occupied by the mails on board ship, according to the following schedule: 3,3 sen (an equivalent of a little less than 1 of a cent in United States currency) for 100 cubic feet of space per nautical mile; 4.6 sen for 200 cubic feet; 5.9 sen for 300 cubic feet; 7.5 sen for 400 cubic feet; 9.2 sen for 500 cubic feet; 11.10 sen for 600 cubic feet; 13 sen for 700 cubic feet; 15.10 sen for 800 cubic feet; 17.03 sen for 900 cubic feet; and 19.6 sen for 1,000 cubic feet per nautical mile.

For all space in excess of 1,000 cubic feet the rate was 2 sen per 100 cubic feet.

Upon the expiration of the contracts, due to end in 1929, the mail pay principle was retained on two lines, those to London and to Melbourne.

As of particular interest, perhaps, at this time, we might state that the three subsidized lines, from Japan to Seattle, San Francisco, and the west coast of South America are now operated by the N. Y. K.

And I think, Mr. Chairman, that it would probably be just as simple to insert in this record the specifications of those contracts. There is no point in reading all the allowances and all the details in connection with them.

The CHAIRMAN. All right. Without objection, they may be shown. (A summary of the main conditions of the contracts with the Nippon Yusen Kaisha lines follows:)

JAPAN-SEATTLE LINE

Duration of contract.-- January to December 1934.
Frequency of service.—Once or more in 3 weeks.

Vessel equipment.—Three under 15 years, 11,000 to 12,000 gross tons each, and of 17 to 19 knots speed.

Subsidies.-For the service between Japan and Seattle, the following amounts were authorized as subsidies for the 5-year period of the contract: 1929–30, 322,269 yen ($160,490); 1930–31, 1,415,908 yen ($705,122); 1931–32, 1,702,580 yen (8848,885); 1933–34, 1,702,580 ven ($848,885); 1934–35, 1,702,580 yen ($848,885).

JAPAN-SAN FRANCISCO LINE

Duration of contract.—January 1930 to December 1934.
Frequency of sailings.—Once or more every 4 weeks.

Vessel equipment.—Three under 15 years, 13,000 to 14,000 gross tons each, and of 18 to 20 knots speed.

Subsidies.—The subsidies covering this service have been considerably increased with the new contract, as compared with recent amounts authorized under the contract which expired in 1929: Old contract: 1928–29, 534,427 yen ($266,145); 1929–30, 943,488 yen ($469,857). New contract: 1930–31, 2,341,449 yen ($1,166,042); 1931-32, 2,865, 140 yen ($1,426,840); 1932–33, 2,865,140 yen ($1,426,840); 1933–34, 2,856,713 yen ($1,422,643); 1934–35, 2,747,163 yen ($1,368,087)

JAPAN-WEST COAST OF SOUTH AMERICA LINE

Duration of contract.—January 1930 to December 1934,
Frequency of sailings.—Once or more in 2 months.
Vessel equipment.-Three under 15 years, 7,000 to 9,700 gross tons each, and of
14 to 16 knots speed.

Subsidy.—The authorized subsidy for the new west coast of South America
service has been increased somewhat as compared with the amounts under the
contract which expired in 1929: Old contract: 1928–29, 1,791,416 yen ($892,125);
1929-30, 1,825,403 yen ($909,050). New contract: 1930–31, 2,227,026 ven
($1,109,059); 1931–32, 2,186,932 yen ($1,089,092); 1932–33, 2,218,078 yen
($1,104,603); 1933–34, 2,043,672 yen ($1,017,749); 1934–35, 2,058,454 yen
($1,025,110).

Mr. Saugstad. Now, unless there are some further questions on that point, I have no further comment to make on the contract system of Japan; and I may suggest that the next subject is that of the shipbuilding and the scrap-and-build plan, construction subsidy plan, of Japan. We have a close analysis of that, which is going to take a long time, and I do not know whether you want me to proceed on that now or not.

The CHAIRMAN. I think we might just as well take that up in the morning. Mr. Newton, did you prefer to go on this afternoon or in the morning?

Mr. NEWTON. I prefer to go on in the morning. I need a little more data.