THE Wairarapa Age MORNING DAILY. SATURDAY, JULY 11, 1908. THE SHIPPING RING.

Wairarapa Age, Volume XXXI, Issue 9136, 11 July 1908, Page 4

THE Wairarapa Age MORNING DAILY. SATURDAY, JULY 11, 1908. THE SHIPPING RING.

The disclosures made by Mr Morgan, the British Government's representative appointed to ascertain the effect upon Nefy Zealand trade of the operations of the Home shipping Ring, provide food for reflection for all who have any genuine interest in the welfare of the Dominion and its commercial relations with the Mother Country. It has remained for the British Government's representative to direct our attention to what we ourselves have been largely apathetic about—viz., that our trade is suffering seriously as the result of the piratical operations of a Shipping Combination engaged in New Zealand trade. Judging from Mr Morgan's remarks his mission ha 3 been amply justified, and the worst fears of the British Government have been realised. The rates of freight from England tu New Zealand and vice versa are exhorbitant, and altogether beyond the exigencies of legitimate profit, while the rebate system encouraging the development of illegitimate and unbusinesslike forms of competition, has made the merchants and shippers unwilling supporters of an abominable system. In brief, the

shipper is forced to despatch ".his goods per medium of this Shipping Combination, who hold the chief lines of shipping to this Dominion, and to enter into a contract not to ship per medium of any outside Company who might be despatching an occasional vessel to these waters. If at the expiry of this contract, the shipper can show that he has not violated the same he will be granted a rebate of 25 per cent, on freight charges. At a glance the policy app.-als to all true Britishers as an inequitable and unbearable one, and the most displeasing factor connected With it is that the Governments concerned are comparatively powerless to interfere, while the merchant or shipper is unable to obtain any redress whatever.' Thus this combination is at liberty to hoist its banner and commit commercial piracy on the high seas, laugh at those clients who may be bold enough to protest and openly defy the Governments which suggest legislative interference. It is suggested that the New Zealand Government, might, like the American Government, pass an Act prohibiting the entrance of gooJs into the Dominion which are in any way concerned in this system of rebate. Our Government has, however, already seen the folly of passing Acts which it has really no means of enforcing, and which, brought into ridicule by failure, is liable to injuriously affect the whole law of the Dominion, and breed in the minds of the rising generation the assumption ' that the law is a convenience, which they can avail themselves of or do without, as they please. Therefore in the interest of law and order, it is wholly advisable that the Government should not enter hastily into legislative action involving the prohibition of rebate goods, which, on the face of America's experience and in view of the numerous evasive measures likely to be adopted by the comDination and its clients, it will, in all probability, be unable to enforce. Something more radical, then, more business-like, is required to combat the iniquitous system in question. The means—the institution of a State-owned service between the Motner Country and the Dominion—the mass of sober thinking people will have no hesitation in approving. For the sum of one million pounds the Government could purchase six first-class ocean going steamers, fitted to meet the require'ments of the Dominion's trade, and capable of conducting at least a three-weekly service between the Home Land and the Dominion. Th money could be readily borrowed at 4,per cent, over a period of twentyfive 'years, the estimated life and utility of the vessels. To pay off this loan at maturity, and the interest from year to year, the Government would require to make a nett profit of £BO,OOO per yeai-, or roughly £13,333 per vessel. Probably | the ;Governmennt would reap well over £IOO,OOO per annum from the service, but the figure is placed at £BO,OOO to allow for the competition . that would inevitably ensue with the Shipping Ring. Thus during the period mentioned, the Government would have conducted a service of inestimable benefit to the farmers and shippers generally, would have knocked the bottom out of the Shipping Combine in so far as New Zealand trade was concerned, and would own a service, probably largely augmented by the exigencies of our commerce, returning a handsome pr.ofit to swell the Dominion's yearly surplus. Prom the purely business standpoint:—Cost of six steamers, £1,000,000; interest at 4 per cent, over a period of loan, 25 year*, £1,000,000; total, £2,000,000. Net profit over period of 25 years, £BO,OOO per annum, £2,000,000; leaving a paid-pff service as an asset in the Government's hands. Figures, providing for strenuous competition over the whole period of 25 years: Cost of six steamers, £1,000,000; interest at 4 per cent., £1,000,000; total, £2,000,000. Nett profit over period of 25 years, £40,000 per annum (paying interest only), £1,000,000. Defidt( amount of loan, to be renewed), £1,000,000. Thus it will be seen that the Government could continue to run the service on the basis of a four per cent, return only, until such time as the Shipping Combine was effectively stifled. It is quite believable that the Ring would put up a strenuuus fight, but it is not in human nature tn' continue such a fight indefinitely. If the present parties to the Ring interested in such a contest had sufficient means and obstinacy to continue a losing policy for so lengthy a period of twenty-five years, then Time will lay its restless hand on their frail anatomies, and those coming after them, desiring reasonable profits, will not continue to fight a Government that can afford to 'e on the .basis of bare costs. i