CHAPTER XIX. THE PRINCIPAL METHOD OF BRITISH SHIP PROTECTION. Reciprocity Repudiated. That the shipping nations-all but our own have cast off dependence upon Reciprocity doing nothing for the growth and maintenance of navigation — and have resorted to protective measures, is not now generally denied. It follows that our Government should withdraw its championship of this condemned policy and cease responsibility for the evils which it has produced. It is supposed by many that subsidies, subventions, and bounties constitute the present foreign systems of ship protection. We shall explain these, but in this chapter shall give special attention to a method strictly English, introduced sixty-eight years ago. Few of our people know about this method, or comprehend its want of principle. The author's business experience drew his attention to it forty-eight years since. A Rival's Craft. When the British Government induced our own to give up a moiety of ship protection, on the ground that it would reciprocate, and virtually promised that "reciprocity or non-protection should prevail in the direct trade thenceforth, it was assumed, at least in the United States, that fair and honorable competition would be common on both sides. The idea was that flag should cut no figure in freighting. It was supposed, of course, that preference would rule engagements in many cases, but very few anticipated that this principle could or would be worked by private endeavor into constituting an effectual system of shipping defense that only the Government of a country could accomplish actual protection. The unexpected happened, however. Being an older and richer country than our own, England had, or could create, institutions that could take the place of Government. Therefore we have now to describe the action and review the policy of such establishments as the Society of Lloyds Register Association, and other bodies having power to influence business for the British marine, and to discourage employment for "foreign" ships. Nature of Insurance Power. Of the forces that may be mustered to favor or impede the employment of vessels, underwriting leads the list with ship inspection, classification of rating, registration of character, and sea insurance. Not only hulls, but cargoes and freights - all things at risk in navigation -are the subjects of influence, control, or interdiction. From the laying of her keel, and during the life of a vessel, she is subject to an irresponsible rule which she may not profitably defy. When this rule is lodged with and controlled by a foreign nation, it may work the utter failure of the best-built marine. The power used is applied through building and inspecting rules and insurance rates. Beginning with a gentle influence upon new and first-class vessels with moderate premiums for hulls and cargoes, it gains control with time and age, rates increasing meanwhile, until shortly it forbids the making of distant voyages and the carrying of particular cargoes, rates growing onerous meantime; and, finally, it deserts the sea-worn ship in port, and leaves its hulk to idle and decay. This is the ordinary course of marine underwriting in action upon shipping of its own flag. It is a necessary factor in trade and transportation by sea, but having its likes and dislikes, its fancies and caprices, its hostile discrimination is loss, despair, and death. Underwriters make general participation in commerce possible, but they can choose the carriers from the fleets of their own flag. They favor large customers, and make what they call “inferior risks," especially those of rival nations, contribute largely to the objects of their beneficence. Using such influence and wielding such power, manifestly a nation's underwriters should be its own. Those of the British nation have always, in rates, favored the shipping of cargoes under their own flag; such being the case, "reciprocity" was, from the first, and is now, a plausible fraud. Early Use of Insurance for Ship Protection. Late in the fourteenth century the Government of Portugal instituted an insurance system as an encouragement of commerce. At that time John II. was king. This ruler laid the foundation of Portugal's superiority in shipping. His reign covered the period of 1385-1433. On his order, vessels were built for the special purpose of battling with the stormy seas off the Cape of Good Hope, the largest at first not exceeding 300 tons. From the improvements in shipbuilding thus originated, Portugal became the country most advanced in naval art. It was long supposed, even by their rivals, that the Portuguese alone could build ships suitable for voyages to India, which they were the first to accomplish around the Cape. The insurance mentioned indemnified only for total losses. The premium exacted was two per cent. of the profits of the vessels, with the addition of an advance fee as a quota upon the value of each cargo. The State could scarcely have been fully reimbursed. How long this policy continued is unknown. Nothing of the kind is now extant.1 As applied to hulls, it was intended to secure the building of a new vessel in place of one lost, and doubtless helped the spread of Lusitanian colonies and commerce over the world. It is thought this policy of King John may have been suggested by the English navigation law of 1381. That protected English shipping by compelling English merchants to employ English vessels in the export trade. In turn this Portuguese policy may have prompted English underwriters, after the wars with Holland, to protect English shipping by inspection and insurance, discriminative against foreign vessels, from then to the present time. Origin and Purpose of Lloyds Register. The Society of Lloyds Register of British and Foreign Shipping was organized in 1834, its directorate consisting of shipowners, merchants, and underwriters of Lloyds Exchange in London-eight persons of each class. Previously for many years there had been two registers, in opposition, one of them said to have been partial to shipowners those probably of London. At this time the West India question had been settled. American competition under the "reciprocity" then extant between the two nations 1 This plan of ship protection has just been revived by Russia. seemed stubborn, and the British felt the need of an agency to control it, or some sort of protection against it. They believed with Admiral Monk. Asked in 1665 the cause for the war then waging against the Dutch, he replied,— "What matters this or that reason? What we want is more of the trade which the Dutch now have." As an institution of quasi-government, the London Lloyds is unique. It has been common for British shipping writers to dedicate their works to this Society as "an extraordinary, but eminently English, association" deserving of studied compliments. These are doubtless encouraging to the Committee whose victim is the "foreign" ship. The foundation for proscriptive power is laid in the rules for building, inspection, and classification, and in a discriminative system of rates for underwriting hulls and cargoes. When the rules were made, only wooden vessels had existence. The aim was not to grade capability with regard to the perils of the sea, but to characterize the "intrinsic qualities" of vessels, which, of course, were governed largely by the cost of building and repairing, rather than by skillful designing. In other words, high class (and low rates) in Lloyds Register represented cost rather than sea-going capability. To this feature was added the condition of being British-built, and especially of British materials. Nothing "foreign" has ever received the highest rating from the Lloyds. Under this régime there was, of course, a high cultivation of national conceit and administrative prejudice, easily converted into active antagonism with respect to foreign shipping. While there was no justice in this discrimination, much ship protection was evolved from it, and, in our case, the rout of a rival. Metal Ship Classification. When iron shipbuilding came about, it was sought to inspect and class its output on the "intrinsic quality" principle, and to set a "rating" of years to express durability, the same as for ships of wood. This plan ere long had to be modified, as some vessels had but brief endurance. The "intrinsic" system remains, but "rating" is not given. More than 10 per cent. of metal-ship losses find place in the list of "missing" — all hands lost. Nevertheless, the Lloyds made the British-built iron ship the standard for the world's carrying trade. Metal vessels are now classed by Lloyds as 100 A, 95 A, 90 A, 85 A, 80 A, or 75 A, according to the tables of scantling by which built. Wooden vessels continue to be classed and rated in "years," hence the facility is greater for discrimination against wooden than iron or steel ships. Wooden shipbuilding admits the choice of a great variety of material, some of it more durable in salt water than iron or steel. The policy of Lloyds has been to keep down the rating of timber produced in the United States and to elevate that of British growth. To this day, our matchless white oak of New Jersey, Maryland, Virginia, and North Carolina is graded the same in years as the growth of Canada, which is allowed but two thirds the time of British oak; ours of the Coast States, or any district south of the Ohio River, being superior in strength and durability to any variety of British growth. To this day, also, Lloyds have never appointed surveyors to inspect wooden vessels in course of construction in this rival country of ours, though they have sent them to all other countries, and this discrimination was practiced before iron shipbuilding became an industry in England. From the first, a standing rule to give no vessel a full class, if not built under survey, has been in force, and also another rule to grant the character A to no vessel, unless her date and place of building are made known. These needless distinctions and regulations, with others like them, betray their only object—the protection of the British marine. - Force and Rigor of Lloyds Rules. The British recognize Lloyds rules as having the force of an act of Parliament, and congratulate themselves that their operation has been beneficial to their own shipping, while their rigor has hurt foreign navigation. These rules have the nature of the upas tree - for the natives of Java, bread; for their enemies, arrow-tip poison. The best-built American ships never received justice. Rigor was given instead, that idleness might result, and ruin follow idleness. If the United States had not agreed with Great Britain to desist from legitimate ship protection, and to open all our ports to free freighting, on condition, implied if not expressed, |