indicate the advisability, and necesity to have the act prohibit the operation of w.iary companies, de partinents, or divisionin We are in favor of a sot satized merchant marine, but believe the operators of Vese vessels should be steams' t operaters and not be permitted to engage in every phase of the industry to the cŭmit ation and detriment of taxpayers. We respectf is a 1' wit the aove for your comaderation and as that due protectant, be given to private firms and individumas. Yours very trulv, BAY TOWING Co. ELECTRIC SUPPLY Co, Inc. Galveston, Tez, May 7, 1935. (hairman, and Members of House of Representatives, Merchant Marine and Fisheries Committee Dear CongresMAN Regarding the new Merchart Marine Act, which is before Congress at this time, we wish to call your attention to the wording of section 511. It is our belief that when the authors of this net inserted section 511, their intention was to stop the subsidized operators from their present practice of monopcaɛing all of the busir esa es tinected with the furnishing of services, such as terminal stop repaititig, stevedoring, towing, etc, to the wghs; fized vessels Some of the subsidized operators are already taking advantage of the wording of section 511 of the proposed act They have taken their mibs. 1 artes it to Por ow", companies in the form of We believe that this was done to evade the intent of the act If the wording of weetion 311 remains na it now is, the present evils of monopoly and discrimination against private industry will We believe that the subs, fized operators ahon' 1 he operators only, and that the services mentored above should be furnished, or a competitive basis, by the private firms who are equipped for theme services This cati be ace ›mplished by worling section 511 so as to protibit the ship operators from operating wiboudary companies, departments, or divisions for the purpose of furnishing ↑ pun services. A., we believe that there should be no ex options allowed by the Authority, We will appreciate you kind consideration of our requesta. Yours very truly, FITRIC Strrty Co, By RK LLOYd, Prendent KANE BottER WORKS, INC, Hos SCHUYLER Oris BLAND, (hairman, and Members of House of Represet lalives, Merchant Marine and Fisheries Committee Dear CongreRMAN Relative to the proposed Mere) ant Marine Act of 1935, ... is now before Congress, we wish to register our oc,ection to the wor ling of section 311, which states t'at no subsi lized steamship company may operate atmuliary companies serving the ships without written consent of V'm Asturity. Frese fit whip operators Nooding mail contracts are now operat ter own petir departinents instead of their former si,bai hiary companies Iese changes have recently been made in view of tur anticipated wor fing of the new act, and of course they have not reneved the evil practions of motopoly against private business firms. We recommend that the new act be worded so that no subsized shup operator will be permitted to own or operate salisiliary companies, departments, or diviscous for the purpose of futustung services to subsidized ships in competition ith private industry. We believe that all services should be furnished by private companies on a strict competitive basis. Also, it is our opinion that the portion of section 511 which rea-la, "except with the written consent of the Authority", should be eliuminted We will appreciate your eutsideration of the above points. Yours very truly, 15056 3576 J. J. KANE, Prendent. MCDONOUGH IRON WORKS INC., Hon. SCHUYLER OTIS BLAND, Chairman, and Members of House of Representatives, Merchant Marine and Fisheries Committee. DEAR CONGRESSMAN: The proposed Merchant Marine Act of 1935 contains under Section 511 a provision designed to relieve the unjust and un-American discrimination that we as taxpayers and ship repairers are laboring under at the present time. We heartily endorse the spirit of fairness that prompted the author to insert this section in the act. We believe, however, that the present wording of the section is not adequate to produce the results desired or the intent of the author. The section would prohibit steamship companies, operating under Government contract, from performing stevedoring, ship repairing, etc., under subsidiary companies but does not prohibit the same companies from performing the same services under a separate division of their own company. The steamship companies interpreting the section in the same manner, have already begun to disdolve their subsidiary companies and establish in lieu thereof a separate department, within their own company, for this performance. This, of course, defeats the intent of the proposed section and offers no relief whatever to those now suffering from this monopoly. We believe also that the authority to administer this act should remain vested in some Government department and not vested in a group of private individuals, so that impartial decisions may be rendered at all times. We have been in business as ship repairers for over 30 years and during this period we have built up a modern, well-equipped repair plant. During the days of the Shipping Board we rendered the Government speedy and efficient service at a minimum cost based on keen competitive prices. Since the award of mail contracts, however, we have not been allowed to even bid on the repairs. There is no need to go into the evils of the present system of operation, as this was brought out fully in the Black and post-office investigation and hearing. As taxpayers we are contributing to the steamship companies through the mail contracts, but as ship repairers we are not allowed to bid on the repairs of ships that we are financially helping to maintain. May we suggest that section 511 be reworded so that the relief, so urgently needed, may be realized. DEAR CONGRESSMAN: We understand that there is now before Congress the Merchant Marine Act of 1935. We are particularly interested in section 511, which states that no subsidized steamship company may operate subsidiary companies to serve the subsidized ships except with the written consent of the Authority. Under the conditions permitted by the mail contracts, the steamship companies are allowed to place all of their ship repairing, towing, stevedoring, etc., with their own subsidiary companies. This practice causes a Government-sponsored monopoly against all private firms who have invested large sums of money in various lines of business almost entirely for the purpose of serving these subsidized ships. We have already filed protests against these business-strangling methods with the Post Office Deparment and the committee headed by Senator Black. During the time when these ships were operated by the Government, the private business firms each had a part in serving the vessels. This was because of the fact that all services to these ships were performed strictly on a competitive contract basis. All private firms who were approved by the Government were allowed to bid on the services that each of them was equipped to furnish. In that way the Government received the benefit of the lowest competitive prices, and each private business had a part in the service and also was able to make a decent living. This method of distributing the subsidy money, in the form of business, among several legit mate firms is certain is a thich fairer arrangement than the present one, whereby mil of the subsidy goes as dishonest profit into the pockets of a few wealthy It appears that some of the present holders of mail contracts are arranging their affairs so that they will be in a position to easily eva le section 511 of the proposed Merchant Marine Art These operators have begun to ' abolish. 'most of their „fmi fiaries. În reanty, they stả own and operate these same s „bsidiary services, bật the name “subsidiary has been changed to “department of the parent comJav Dere is no doght that this move is simply to evade section 511 of Vie act. To the private business man who is equipped to serve these slips, these services may as well be performed by a subsidiary of the operator as to be performed by a ́ department 'of the operator a stuppur g company in either way, the monopolv is still there and the private busir ens is left out in the cold We do not know how well acquainted vou are with the conditions which now exist in Texas ports as a direct resuit of this monopoly, but we wish to remind you that they are really serious The private firms who have equipped themselves for serving these wotw.dized ships are almost ready to close their doors because of the monopoly heid by the subsidized operators Of course, this is made possible by taxpayers' money, to which we are all forced to contribute It has been proven recently that the present methods have resulted in fraud, Improper accounting of expenditures, and ridiculousty high operating costs. These evils can easily be eŭminated by strictly competitive bidding under close Government supervision. This would also give the private industries and taxpavers a chance to receive some of the business to which they are justly entitled. We respectfully request that private firms be protected in the award and performance of all work which indirectly is paid for by the Government and that the Merchant Marine Act of 1935 be so worded that all services necessary for the operation of the subsidized shops be performed on a strictly competitive contract basis by private firms approved by the Government We far to understand why the authority should be allowed to make execptions to the new law. This would merely be the loophole for which the subsidized operators are looking. The record and the many questionable decisi itin rendered in the past by the Shipping Board plarly show the necessity to have the act itif prohibit the operation of subsidiary companies, "departments', or * divisiotas Also, we feel that no subsi lized company nor any of its officials should be permitted to be financially interested in any firm with whom the steamship company may do business. Das will chiminate favoritism and reduce the consequent excessive operating costs We will appreciate your kind consideration of our request, as we feel that the time has now come for us to be released from the oppression to which we have been subjected. Yours very truly, 8. H. KEMP, Secretary-Treasurer. Gray's Iron Works, Ive, Hon. SCHUYLEr Otis BianD, Chairman Merchant Marine ani Fisheries Committee, House of Representatives Dear CongreaSMAN. In the proposed Merchant Marine Act of 1935, which is new before Congress, we are very much interested in section 511, which deals with the operation of subsidiary companies by the subs, lized operat.g companies Under the conditions of the ma-contract system, the wibwölized steamship companies are allowed to place all their stip repairing, etc, with their own wabsidiary companies This practice causes a Government spor sored mon, pły against the numerous private concerns who have investe i large situs of thor ev in plants and equipment for the servicing of these subs, lized vessels We beve that the real intent of section 511 of the act is to protabit such monopolies, However, we do not believe that this purpose will be accomplished unless the wording of the act is changed. Some of the present mail-contract holders have no doubt been informed as to the probable wording of the proposed act. Therefore, they have abolished their subsidiary companies and have taken these subsidiaries into the parent companies in the form of "departments" and "divisions." This was done to evade section 511 of the act. If the wording of the proposed act remains as it now is, this monopolistic evil will remain as it has been for the past few years. In the eyes of the private business man who has invested his life and money in order to be able to serve these ships, these services may as well be performed by a subsidiary company as to be performed by a "department" of the parent company. In either case, the evil is still there. The private companies and individuals who contribute to the subsidy, by paying their taxes, are left with their plants going to ruin and their former employees going on Government relief while the treasuries of the subsidized companies are swelled considerably. It has been recently proven that the present conditions have resulted in fraud, misappropriated expenditures, and exhorbitant operating costs. These evils would be eliminated if the act were so worded that all services to these vessels must be performed by private companies, approved by the Government, through competitive contracts and under strict Government supervision. We realize that the new act is intended to be fair to all concerned, but we fail to understand why the authority should be allowed to make exceptions to the law. This would merely provide the big loophole for which the subsidized operators are looking. The record and the many questionable decisions rendered in the past by the Shipping Board plainly show the necessity for having the act within itself prohibit the operation of subsidiary companies, "departments", or "divisions" for the purpose of ship repairing, towing, stevedoring, or any other servicing. Also, we feel that no subsidized company nor any of its officials should be permitted to be financially interested in any firm with whom the steamship company may do business. This will eliminate favoritism and collusion and will reduce the consequent exorbitant operating costs. We will greatly appreciate your full consideration of our petition. Hon. SCHUYLER OTIS BLAND, J. WALMSLEY. President. FARMER'S MARINE COPPER WORKS, Chairman Committee on Merchant Marine and Fisheries, House of Representatives. DEAR CONGRESSMAN: Section 511 of the proposed Merchant Marine Act of 1935 now before Congress prohibits any subsidized steamship company from operating subsidiary companies serving the subsidized vessels, except with the written consent of the authority. The present system under the mail contracts has proven most unsatisfactory, as a distinct monopoly is created. The steamship companies are operating their own subsidiary companies, doing their own repairs, towing, stevedoring, etc., thereby freezing out all private firms that heretofore had been able to make a legitimate living in their lines of businss. Under the old system of operation, while the Government was operating the ships, everybody who was a taxpayer had an equal opportunity to bid on the work that their respective plants were equipped to do. The Government at that time was only interested in keeping the ships on the seas and did not allow shipping companies using Government aid to freeze out small businesses, who, in paying taxes, contributed their share of the subsidy. In spite of the disclosures brought out by the Black committee and Post Office Department in the recent hearings, it seems that the steamship companies still have their "ace in the hole" in the form of "the written consent of the authority", as several of the steamship companies have liquidated their subsidiary companies and have formed departments under their own names, which are still performing the same services as were performed by their subsidiary companies, the result being the same as before, that is, the total elimination of all private businesses not interested in the steamship companies. We respectfully request that the act be so worded that it will protect the private firms and give them an equal opportunity to again work on subsidized vessels, reducing costs and giving the private firms a fair deal, to which they are justly entitled. Yours very truly, LESLIE G. FARMER, Manager. Dear ConeREMAMAN We note that section 511 of the Merchant Marine Act of 190,5 now before Congress states that rocontractor unter a contract in force part shall a fer or pernit ars insurance, stevedorp g. terminai stip to whoat or other services of he character to be suprijed vessels jr fer arch, contract by any athapdiary or other corporation directly or ས་སམྦཱ ༢ ནི་སྐ controlled by such, for tractor except with the written consent of the ་་ W sve discor tinged » .p work in fact we were forced to do so on accourt of the existi' g condit.oTER It t' is law is passed and t'e loop' oie jeft in it, we will be wore off tan before When eng sadering tias art welope that you will note what we have to say in reference to giving the Abort per peqje fiat cor tractors do Peir own work in their own, at opn, pua, ta, jej artuente, divisions, or whatever they may call their almidiary Very truly vOUTH, ALBERT P J. Volot, Owner, MARINE SPECIALTY & MILL SUPPLY Co, Inc. New Orleans, La, May 8, 1935 Hon Cor gressman 8. O BraND, Chairman Merchant. Ma ine and Fisheries Committee, Washington, DC Dear Congressman Bland. I have been reading the proposed Merchant Marve Act of 1935, known as the “Copcar Pali, a - I am particuatiy interested in section ›il, which states that no sits, fized steamistup company stall operate any subsidiary companies except with the written consent of the A athority I do not believe that the purpose of section 511 has been thoroughly covered, thanmach that it does not prohabat a wibni lized company from creating departinents” to perform the same work that the submi liary companies are doing now Prior to the awarding of the mail contracts in the Guf, we were caused on by the United States Shipping Board to bid oti ali eiasses of suppues firtushed the vesis it. order that we be in position to submit buds and properiv, carry o it the contracts, if successf il, it was necessary that we carry on band a large » «ppy of special marine stock. Under the preser t arrangement, where the subsidized steamship companies bay from their sits diary a „ppiv companies only, we have beer, left with thousands of doi ars of mater al on hand as I have no opporturity at all to sei to comparses that are being operated with modes that we contribute, through taxation, to support the m This letter is a request for protection, from the evils of the past that we believe, as taxpayers, we are justly entitled to, and respectfully ask that you give some atter tion to our request and amer i section 311 of the Copeland bili to protect us Thanking you for any consideration, we remain Yours very traily, FRANK VIOLA, Prendent CHAMBER OF COMMERCE OF THE UNITED STATES ‹ Report of special committee on merchant marine To the board of directors In November 1934 your special committee on merchant names,) mitted a prejminary report. The present report supplements the pre-inut arv report and recommends principles for art mat. 5 in revon one of the present pack of G vernmeut aid to the merchant manite and in de aung with, ocean sloping conferences. IMPORTANCE OF THE MERCHANT MARINE In the preliminary report it was pointed out that an adequate merchant marine is essential in the development of our export and import trade, to secure fair consideration of the interests of American exporters and importers in the making |