with the maximum working hours, which eliminates the exploitation of labor—and, third, the elimination of child labor in our industries, so that we have a certain standard, that costs us, absolutely, more than the cost to foreign concerns.

Mr. RYAN. Wait a minute.

Mr. SIROVICH. We will go on with you and take you, step by step, and show you. That is all granted, that the American laborer has those standards.

Mr. RYAN. Yes.

Mr. SIROVICH. That is all granted.

Now, the concern with European standards comes along; and you have no minimum wages, and you have no maximum hours of labor, and you have no abolition of child labor. Is that right? Mr. RYAN. You are asking me a question?

Mr. SIROVICH. Yes.

Mr. RYAN. May I answer that?

Mr. SIROVICH. Yes; I want you to.

Mr. RYAN. I will say "no" as to many things; "yes", as to other things

Mr. SIROVICH (interposing), Let us go on

Mr. RYAN (interposing). But, even assuming that: First, you are not doing anything in this provision for the American exporter, who

Mr. SIROVICH (interposing). Yes

The CHAIRMAN (interposing). Let us go one at a time. Let us get through with this examination. We are not going to agree, and there is no use lecturing the witness and no use

Mr. SIROVICH (interposing). Mr. Chairman, I think that I can convince this gentleman.

The CHAIRMAN. We do not have to convince him. We can disregard his testimony if we do not find that it is sound.

Mr. SIROVICH. I would like to treat the gentleman with courtesy and respect, because he has treated me with courtesy, and I would like to convince him, and I think I will finish in 2 minutes.

Now, when we do that according to American standards and make the product, it has cost more; and if we put them upon our own ships, upon the American merchant marine, by virtue of the fact that we have a differential in operation, that our cost of operation is higher than the European cost of operation, according to American standards of living, we have added another additional expense. Is not that true?

Mr. RYAN. Oh, no; not joining those together that way, that does not prove that you should fix minimum ocean freight rates. To the extent to which you prevent the American exporter, who has made goods in this country, from delivering his goods cheaply in the foreign markets, you have deprived him of the opportunity to sell and have deprived the American laborer of employment. That merely gives the American conference shipowner a higher rate on anything he may carry, but it does not sell the goods in a foreign country. And another foreign country, which is able to deliver goods at a lower rate, will come in and take the business..

Mr. SIROVICH. You are opposed to this because your organization, that you represent, gives cheap transportation by the use of foreign

Mr. RYAN (interposing). I say that our interests are identical, so far as seeing the business of American exporters

The CHAIRMAN (interposing). One at a time. The witness will wait for the question.

Mr. SIROVICH. Since it is only the differential between the freight that you can levy and the freight that our American merchant marine must get, we provide, through this bill, a yardstick, in which a man can substitute for the differential any loss to the steamship that carries it, that has got to compete with your organization

Mr. RYAN (interposing). That comes out of the-
The CHAIRMAN (interposing). One at a time, please.

Mr. RYAN. That is at the expense of and comes out of the pocket of the American farmer, cotton grower, and manufacturer.

Mr. SIROVICH. Right. But we are keeping these people on the dole at the present time at the expense of the American farmer and at the expense of the American industrialist. We give them their self-respect by finding work for them instead of keeping them upon a dole. If we continue the systems that you are advocating, we put more American people out of work, we put more people on the dole, but this way we will open the markets of the world for our own people.

Mr. RYAN. May I just suggest, I do not see why you cannot see quite clearly, and I feel it is my fault in not making it clear to you. The CHAIRMAN. We will have a statement from you. I am not going to have this argument going on.

Mr. RYAN. What I am trying to make plain is this, that the reason we are operating here is this: There has been tacked onto this ship subsidy bill a rate regulation bill, which has nothing to do with ship subsidy. If you had a separate rate-regulation bill here there would be hundreds of American exporters, shippers, farmers, and cotton growers here the same as they have always been whenever a rateregulation bill has been before Congress. They are not here today.

Our interest, I say, in view of the fact that we get no subsidy, and that it makes not one iota of difference to us whether it is the American merchant marine we compete with, is identical with that of the American exporter. Now, I do not say it is identical with that of the American shipowner, but I say if you want to give a subsidy to the American shipowners you should do it directly and increase the amount of your subsidy to them.

The CHAIRMAN. There is no use going on with that speech. You have been over all that.

Mr. RYAN. Let me add one thing in answer to Mr. Sirovich. The only hope of the American laborers who are producing their products in this country, as distinguished from the shipowners, of keeping their employment and not being thrown out of employment is to have a low freight rate on the seas from the United States to a foreign market, until such time as the American merchant marine constitutes a majority on the seas, as a national transportation system. Until such time any rate-regulation provision such as this will operate under existing conditions, where the foreign-flag conference lines constitute the majority, as an indirect subsidy of very substantial size, of several million dollars to those foreign-flag lines. In other words, what you are doing by fixing a high minimum freight

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rate at the expense of the American exporters is to give most of it to foreign-flag conference lines. It does not come to us.

The CHAIRMAN. You have been over all that.

Mr. RYAN. I thank the committee very much. There have been others here protesting against the regulation, but particularly they are people who are operating American-flag ships.

Mr. HAMLIN. What company do you represent?

Mr. RYAN. The Isbrandtsen-Moller Co., Inc., which is a New York corporation and operates Danish-flag ships.

Mr. HAMLIN. A foreign country?

Mr. RYAN. It operates Danish-flag ships.

Mr. HAMLIN. That is about all I want to know. That is all the questions I will ask.

The CHAIRMAN. All right; thank you very much, Mr. Ryan.

STATEMENT OF CAPT. JAMES HARVEY TOMB, U. S. NAVY, RETIRED, SUPERINTENDENT, NEW YORK STATE MERCHANT MARINE ACADEMY

Captain TомB. Members of the committee: In section 802 where they propose to adopt a national merchant-marine academy, nothing has been said about the property. The War Department is the one department which has most of the water-front property; sometimes the Navy. I would like to suggest that any water-front property belonging to any department of the Government may be transferred. to the Department of Commerce for these purposes. In other words, there is a Federal law to the effect that the War Department may not transfer any property to any other department except on the approval of Congress.

Mr. SIROVICH. That could be done even without that amendment. Anybody could put a law into Congress transferring such property to another department with the consent and concurrence of the Secretary of the Navy or the Secretary of War.

Captain Toмв. Yes; but in this case the War Department could not transfer any property to the Department of Commerce unless the Congress approved.

The CHAIRMAN. You want to have that done regardless, or is it contingent?

Captain TоMB. You might put in the words "available water-front property belonging to any other department of the Federal Government may be transferred to the Department of Commerce."

The CHAIRMAN. I think you ought to leave that separate and apart. We have done that. We reported out a bill today. Captain TOMB. Is that in the bill?

The CHAIRMAN. Not that particular property.

Mr. SIROVICH. Suppose that you had a piece of available property on the Hudson River, and this bill passed without that, and you thought you could utilize that. What you would have to do would be to go to your Congressman and have him introduce a bill that this piece of property which is available should be transferred from the War Department to this Department. If it has the approval of the Secretary of War and the committee it will automatically go through.

The CHAIRMAN. If it gets the approval of both Secretaries.

Captain TоMB. But then that takes another bill in addition to this bill in order to enable any transfer to be made.

Mr. SIROVICH. Sure; you would have to say what property you are transferring.

The CHAIRMAN. I hardly think we would want to bring this in, but go ahead and make your statement.

Mr. SIROVICH. It is loading it down.

Captain TоMв. Another thing I wanted to call attention to is our alien seamen law.

Mr. HART. Before you pass that, what is the object of that proposed amendment?

Captain TOMB. That is in order that the United States Merchant Marine Academy may be established at some place which may be selected by the Federal Authority. It avoids the purchase of property.

We have an alien seamen law, adopted after the war of 1812 to protect the seamen on American ships. That law is to the effect that an alien seaman upon obtaining employment upon an American ship may take out his first citizenship papers, and on obtaining such papers have all the rights, privileges, and protection of a full fledged American citizen.

The CHAIRMAN. Was not that law subsequently repealed?

Captain TOMB. No, sir; it is still on the books. It has been introduced in Congress. It was introduced last year, but it failed to pass.

The CHAIRMAN. Yes; but I am wondering whether we are clear on that.

Captain TоMB. It passed the House, but not the Senate.

The CHAIRMAN. That was not the 1812 act that we were seeking to repeal, because I introduced that same bill last year. It is regarding what are known as the 3-year certificate men.

Captain TоMB. Yes, sir; that is the one.

The CHAIRMAN. That is to repeal an act that was passed in 1918. Captain TоMв. That, as I understand it, was a continuation of the original act passed after the War of 1812.

The CHAIRMAN. I think that the record will show that the 1812 act had been repealed. Then in 1918, when we were getting the large merchant marine and did not have the men to man it, a bill was introduced-it did not come from this Committee, but from the Committee on Immigration and Naturalization-to the effect that these men who had taken out their first papers and had three years' experience were to be considered American seamen and to have the benefits and privileges of American seamen.

Then when we passed the Act of 1928 we had lost sight of that Act altogether and nobody considered it, and we provided that 66% percent after 5 years should be American seamen. Then it developed that the question arose as to how these men should be construed, whether they should be within the two-thirds, or outside the twothirds. It was submitted to the Attorney General, and the Attorney General said they had to be counted as American seamen. The result is that you can have a vessel with all aliens on it. Why? Because you can have two-thirds made up of 3-year men and you are entitled to have the one-third aliens, so you could have your vessel, having one of those ocean-mail contracts, manned entirely with aliens, though

it was the intention of Congress that two-thirds should be American citizens.

Captain TOMB. Thank you, sir; I have learned something which I did not know before.

Mr. SIROVICH. We are trying to abolish that.

Captain Tомв. I did not know that before.

Mr. SIROVICH. We are trying to abolish that, so that the two-thirds will really be American citizens.

The CHAIRMAN. We have tried to get it through. I did what I could to get it through last year. This bill, H. R. 67, known as the Bland bill, is now pending in the Senate Committee, and Mr. Furuseth has just informed me that it is going to be reported unanimously by the Senate Committee, so that we have a chance of getting it.

Mr. SIROVICH. What would your bill then provide, Mr. Chairman?

The CHAIRMAN. It repeals the law of 1918.

Mr. SIROVICH. So that if we said in new legislation that we want 100 percent American citizens to man our ships, they would be really American citizens having their second papers?

The CHAIRMAN. In this bill we have used the words "native born and completely naturalized."

Mr. SIROVICH. Yes; that would be better.

The CHAIRMAN. But unfortunately we provided in this bill a percentage which we thought at the time we put it in the bill was increasing the percentage of American seamen; but in the larger vessels it decreases it. That will be corrected. It came about in this way:

The 1928 act provides that two-thirds of the crew shall be American citizens. In this bill we provide that 100 percent of the engine crew and the deck crew are to be citizens. We left out the steward's department, which will be large on a passenger steamer, or covered only a certain percentage of the steward's department; I have forgotten which. But the matter was called to the attention of the Senate in a statement that was made by Mr. McVay before the Senate committee last week, when I was there. It was the opinion of Senator Copeland and myself, who had been working on the bill, that we had not done the thing we intended to do.

Mr. SIROVICH. And that will be changed.

The CHAIRMAN. That will be changed.

I do not know that I have a copy of the hearings, but my recollection is that the hearings refer to the act of 1812, and that was repealed.

This is the copy of the report and of the bill which is pending in the Senate [handing documents to Captain Tomb]. If that 1812 act happens to be unrepealed, we may have to do something else about it.

Mr. SIROVICH. Mr. Chairman, if the Senate has reported out your bill unanimously and favorably, and if it passes the Senate as it will undoubtedly pass the House this year

The CHAIRMAN. It has passed the House.

Mr. SIROVICH. I mean, when it becomes law, if we now insert that the American seamen on board the merchant marine vessels have to be 100-percent Americans, that means American-born Americans and those that have been naturalized?

The CHAIRMAN. I think so, but to avoid any question we put "native born and completely naturalized."

Mr. O'LEARY. In other words, it eliminates the first-paper men?