History of merchant shipping and ancient commerce, Volume 3 (of 4)

by W. S. Lindsay

CHAPTER XIII.

Scarcity of shipping at the commencement of the Crimean War—Repeal of the manning clause—Government refuses to issue letters of marque—Great increase of ship-building and high freights—Reaction—Transport service (notes)—Depression in the United States—The Great Republic—Disastrous years of 1857 and 1858—Many banks stop payment—Shipowners’ Society still attribute their disasters to the repeal of the Navigation Laws—Meeting of Shipowners, December 15th, 1858—Their proposal—Resolution moved by Mr. G. F. Young—Mr. Lindsay moves for Committee of Inquiry—Well-drawn petition of the Shipowners—Foreign governments and the amount of their reciprocity—French trade—Spanish trade—Portuguese trade—Belgian trade—British ships in French and Spanish ports—Coasting trade—Non-reciprocating countries—Presumed advantage of the Panama route—Question discussed—Was the depression due to the withdrawal of Protection?—Board of Trade report and returns—English and foreign tonnage—Sailing vessels and steamers in home and foreign trades—Shipping accounts, 1858—Foreign and Colonial trades—Probable causes of the depression in England and America—American jealousy and competition—Inconclusive reasoning of Board of Trade—Government proposes to remove burdens on British shipping—Compulsory reciprocity no longer obtainable—Real value of the Coasting trade of the United States—Magnanimity of England in throwing open her Coasting trade unconditionally not appreciated by the Americans.

Scarcity of shipping at the commencement of the Crimean War.

Repeal of the manning clause.

The spring of 1852 ushered in the dawn of brighter days for the disconsolate and “ruined” British shipowner: he could then, at least, obtain, with prudent management, a moderate remuneration on his capital, but there was no actual scarcity of tonnage until 1854. Freights, as we have seen, had no doubt materially risen in the interval, because we had hesitated to increase the number of our ships, while foreigners, with the exception of the Americans, had refrained from rushing into the trade we had opened for them to the alarming extent anticipated. Consequently, there was, hardly, tonnage enough to meet the requirements of commerce created by the abolition of our Navigation Laws, still less to satisfy the sudden demands which arose when, in March 1854, England and France declared war against Russia. Suitable vessels could not then be found in sufficient numbers to send forth, with the requisite despatch, the allied armies and their supplies to the scene of action; nor, I must add, could British seamen be obtained to man with expedition our ships of war. Government, therefore, threw open our Coasting trade, and repealed the once famous manning clause, which, however, neither increased, on the average, the number of foreigners we had hitherto been allowed to employ in our ships, nor deteriorated the number and quality of British seamen, though aiding, at the time, the more expeditious equipment of our fleets.

Government refuses to issue letters of marque.

But a much more important step affecting the interests of maritime commerce and the progress of mankind was taken in 1854. On the declaration of that unfortunate war, her Majesty in Council, in order to preserve the commerce of neutrals from unnecessary obstruction, waived the belligerent rights appertaining to the Crown by the law of nations, by declining to issue letters of marque or by confiscating neutral property on board of Russian ships, or neutral ships with Russian property on board, provided such goods were not contraband of war. She, however, reserved the right of blockade; a reservation by which I may remind my readers, her Majesty’s subjects were, commercially, by far the greatest sufferers.[170]

Great increase of ship-building and high freights.

The extraordinary demands for shipping on the outbreak of war led to their production with still more extraordinary rapidity, and furnished, at the same time, the most convincing proofs that we had within ourselves resources far beyond all other nations for meeting the emergency of war, without the necessity of keeping up a large and expensive standing navy, especially as such a navy must always be in a state of transition. The high rates of freight then offered for transports, ranging from 20s. to 30s. a register-ton per month for sailing vessels, and from 35s. to 65s. per gross register-ton for steamers,[171] produced not merely all the vessels required for our own transport service,[172] but, also, for the wants of France, whose armies without our aid could not have been conveyed to the Crimea.[173]

With such rapidity, indeed, were sailing ships produced, that the supply not merely soon overtook, but greatly exceeded the demand; the consequence, of course, being a great reaction in prices. Steam-vessels, in the construction of which there had been a large amount of speculation, likewise felt ere long the depression, and before the close of 1855 the rates for these had fallen to 40s. and 35s. per ton per month: the surplus steamers, however, found their way, in the end, to the advantage of all concerned, into trades formerly carried on by sailing vessels.

Reaction.

Although the Russian war had created at first an unusual demand for vessels of every description, and had given an extraordinary impulse to ship-building, prudent shipowners soon foresaw that so sudden a rush of prosperity could not long endure without as sudden a revulsion, and “that it was fallacious to suppose that the same demand would continue even while the war lasted.”[174]

Transport service.

Nor was it less apparent that the number of vessels engaged by Government exceeded what was actually required for the prosecution of the war, and that, if hostilities continued, the number would be materially reduced as soon as something like an organised system had been established.[175] Such, indeed, proved to be the case; for, when a temporary Transport Board was appointed, various vessels were discharged, and the rates of freight for sailing ships, which had averaged 1l. 7s. 7d. per ton, fell to 15s. 10d. per ton. Indeed, there can be no doubt that, had there been a well-organised board in operation when war was declared, the sea transport service, which cost this country 15,000,000l. sterling during that brief and unhappy war, would have been far more efficiently conducted for two-thirds that amount.[176]

Great and unusual depression naturally followed the cessation of hostilities. Although wars and famines, however unfortunate and disastrous to the nation, afford rich sources of emolument to shipowners, the adverse reaction is frequently sudden and severe. Before the close of 1857, our markets had become so overstocked with vessels of every kind, that it was hardly possible to obtain for them, in any branch of trade, remunerative freights.

Depression in the United States.

Nor were the Shipowners of the United States in any better position. They, too, had overbuilt themselves. Their exclusive Californian trade had offered so many inducements, and, in fact, such large fortunes had been realised out of it, that many more vessels than could be profitably employed were built in the Northern States between 1849 and 1854. Some of these were placed on the trade with Europe. A very large amount of capital had been invested in the famous ships thus employed; but even these, before the close of 1854, were becoming unremunerative, owing to the competition of British iron screw-steamers, which I shall very fully describe hereafter, as they were the main weapon, whereby we bade defiance to the competition of all other nations, in the general ocean race then just commenced. As these splendid iron ships soon commanded all the passenger traffic, and, at the same time, secured the preference by shippers of high-classed and valuable goods, which could afford to pay the heaviest rates of freight, many of the American clippers were obliged to seek employment elsewhere. As the Great Republic[177] was one of the finest, as well as the largest of these famous vessels—indeed, she was the largest sailing vessel in the world, I furnish an illustration of her at page 360. But though this vessel and a large number of the American liners found temporary employment in the French transport service, they on the cessation of hostilities were obliged to seek employment elsewhere; and, so great was the depression, that American shipowners, in 1857, suffered quite as much as did the generality of those persons who owned sailing vessels in Great Britain. Indeed, on the 1st January of the following year, there was not a single vessel building on the stocks of New York for the mercantile marine, and, for many months previously, the shipbuilders throughout the United States had been at a complete standstill.

THE “GREAT REPUBLIC.”

Disastrous years of 1857 and 1858.

But all branches of trade throughout the world were now suffering to a greater or less extent, and 1857 and 1858 will long be remembered as gloomy years. The outbreak of the mutiny in India, the consequent suspension of remittances from the East, and the demand for specie, together with an uninterrupted outflow of the precious metals to the Continent, led to an alarming drain of the bullion in the Bank of England.

Many banks stop payment.

After a long struggle to maintain cash payments without pressing unduly on the mercantile classes, the rate of discount rose so high as to render necessary, for the second time, the temporary suspension of the Bank Charter Act of 1844. The effect of this twice-repeated measure was disastrous to many merchants engaged in the trade of the United States; not a few of whom were obliged to suspend payment. The stoppage of the Northumberland and Durham district Bank, with liabilities amounting to 3,000,000l. sterling; as well as those of the Western Bank of Scotland, which had been engaged in wild speculations in the United States and elsewhere, with liabilities to the extent of 8,911,000l., and that also of the City of Glasgow Bank for 6,000,000l., tended materially to increase the depression.

The Liverpool Borough Bank, which had been previously drained by the insolvency of various mushroom speculators in ships, failed for 5,000,000l., and the Wolverhampton Bank followed for 1,000,000l. Many private mercantile firms, also, whose liabilities alone were variously computed at a sum not far short of 20,000,000l., were, at the same period, obliged to suspend payment.

Shipowners’ Society still attribute their failures to the repeal of the Navigation Laws.

Through such overwhelming disasters, it was hardly to be expected that the Shipowners of Great Britain would pass unscathed, especially after the prosperity they had enjoyed during the Crimean War. Nevertheless, the General Shipowners’ Society of London, in the report of the annual meeting, held on the 25th June, 1858, does not appear to have attributed the cause of the depression under which Shipowners were suffering to the revulsion in commercial affairs. On the contrary, they still held the strange delusion, that, so far as they were concerned, the repeal of our Navigation Laws, together with the absence of reciprocity on the part of foreign nations, were the main causes of suffering: curiously enough, too, the report attributed some portion of their misfortunes to the Merchant Shipping Act of 1854, and the Passenger Act of the following year.

Having thus, as they conceived, ample grounds for an appeal to Government, they, like the frogs before Jupiter, made an effort to induce Lord Derby, their great friend and patron, and then Prime Minister, to relieve their depressed fortunes.

Nor was this agitation for relief confined to the Shipowners’ Society of London. Aberdeen, Dundee, Newcastle, Shields, and various other ports on the north-east coast, where, perhaps, foreign competition was most severely felt, sent in petitions to Parliament; while numerous pamphlets appeared in which the ostensible cause of the Shipowners’ suffering was duly set forth. We had the old stories retold of the huge Yankee ships eating up all their profits in the Indian trade, told, too, at a time when American shipowners were suffering quite as much as themselves. Nor did the authors of these pamphlets fail to remind us of our old hobgoblins, the Swedes and Norwegians, who, faring sumptuously on “black-bread,” were carrying all before them in the Northern Seas and in the Mediterranean, to the irretrievable ruin of the hapless British shipowners.

Such tales of sorrow from the outports, including Liverpool, Glasgow, and those on the west coast of Scotland, where not a few of these “ruined” men had realised handsome fortunes during the Crimean War, made a deep impression on the bosom of the General Shipowners’ Society of London, whose hearts had been softened by their own “losses.”[178] They, too, as we have seen, entirely coincided with their brethren of the outports as to the cause of the depression: and, while it was resolved to continue pouring in the petitions to Parliament expressive of their views and praying for relief, and, also, to stir up an agitation through the medium of pamphlets and that portion of the press which entertained similar opinions to their own, it was likewise considered desirable to make a combined effort by the means of a public meeting to be held in London, so that their sufferings and their wrongs might become generally known among all classes of the community.

Meeting of Shipowners, December 15th, 1858.

Their proposal.

This meeting was consequently held at the London Tavern on the 15th December, 1858. The chairman, however, Mr. Duncan Dunbar, then one of the greatest individual shipowners in the kingdom, in opening the proceedings, declared that no idea was entertained of asking for a reversal of recent legislation, the delegates from the outports having previously come to the resolution to limit their demands to the consideration of the question of reciprocity, praying the Crown at the same time to put in motion the clauses of the Navigation Repeal Act, which authorize the Queen to retaliate on such foreign Powers as should refuse reciprocity, and to place the ships of these countries on, as nearly as possible, the same footing as that in which British ships are placed in the ports of such country.

Volumes of statistics were brought forward by Mr. George Frederick Young, who appeared as chief spokesman, and, as heretofore, the undaunted champion of his party, to show that, though British shipping had increased since the repeal of the Navigation Laws, foreign vessels frequenting our ports had done so in a far greater proportion. Mr. Young repudiated the idea—the “delusion”—that consumers were benefited by the reduction of freight to the full extent of the difference which must exist between the sum paid to the English carrier and the rate of freight paid to his foreign competitor; and concluded his remarks by a resolution to the effect that the existing “most deplorable and ruinous depression” had been partly caused, and was greatly aggravated by the unequal competition to which British shipping was exposed by the repeal of the Navigation Laws. Other speakers from Liverpool, Glasgow, Hull, Shields, Montrose, Dundee, and Aberdeen described the state of affairs in their several localities; and, finally, a petition to the Queen was agreed on, recapitulating the progress of legislation on the Navigation Laws, and alleging that the apprehensions entertained when that measure passed were fully verified by the result.

Similar meetings were held in various other parts of the country, including Tynemouth and North Shields, which I then represented, and a wish was intimated to me from those places that I should bring the state of the shipping interest under the notice of the House of Commons.

Although I entertained very different views to those expressed at these meetings, I felt, nevertheless, that our Shipowners had many just causes for complaint; and that, though it was now alike beyond the power of the Legislature to control the rising destinies of other and rival nations, or even confine their mercantile marine within the narrow limits prescribed by our jealousy, so as to remove all dread of foreign competition, there were yet many burdens from which they ought to be relieved, and many restrictions, to which they would never have been subjected by the State, had it not been considered that they derived peculiar benefits from the laws so long enforced for their supposed advantage.

Mr. Lindsay moves for a Committee of Inquiry.

Accordingly I moved for a committee “to inquire into the operation of certain burdens specially affecting merchant shipping,” which after an interesting debate the House was pleased to grant.

But the committee had scarcely assembled when Parliament was dissolved, and it was not until a new Parliament had met, that the subject was again brought under the notice of the House of Commons. In the meantime the Shipowners’ Society of London had urged Government, in a letter of the 22nd February, 1859, for a reply to their petition praying the Queen to exercise the powers vested in her, and to put in force the retaliatory clause of the Repeal Act of 1849.

Well-drawn petition of the Shipowners.

This petition, I must state, was short and exceedingly well drawn. It gracefully avoided all matters of detail and controversy; the petitioners approached her Majesty, “animated by the most profound sentiments of loyalty,” for which, indeed, I must add the Shipowners of the United Kingdom have ever been conspicuous; they represented “the ruinous state of depression” into which their interest was “plunged,” and they “implored” her Majesty “to be pleased to extend to that important national interest such assistance and relief as her Majesty was enabled to afford to it through the exercise of those powers which were vested by law in the Crown.”[179]

The petition was signed by the chairman, Mr. Dunbar, as representative of the meeting; by Mr. George Marshall, as chairman of the General Shipowners’ Society; and by deputies from most of the leading seaports of the kingdom. From the weight and high character of the persons who had signed this petition, Government could not do otherwise than attach considerable importance to it, however much they may have differed from the mode of relief the memorialists prayed Her Majesty to adopt. Indeed, the time had arrived when it was desirable for Government to review the effects really produced by the repeal of the Navigation Laws, and to inquire into the burdens and restrictions to which British Shipowners were still subjected. Nor was it less necessary to direct attention to the state of foreign legislation with regard to British shipping, since the removal by us of all restrictions on the vessels of foreign nations engaged in the trade of the United Kingdom and her possessions. As the exposition of the bearing of these questions, necessarily, furnishes a complete insight into the Merchant Shipping of the country at that period, it is my duty to furnish the report of Government, if not in detail, at least at greater length than I might otherwise have done.

Foreign Governments and the amount of their reciprocity.

In this carefully considered document, it was, authoritatively, announced that France, Spain, and Portugal, where partial restrictions on the ships of other nations were still maintained, were the only foreign Governments which had not extended complete reciprocity to British ships so far as regards the foreign oversea carrying trade.

French trade.

In France, under the treaty of 1826, British and French ships were on a footing of equality in the direct trade between the two countries; but, in the indirect foreign trade, in the colonial, and in the coasting trades of that country, British ships still laboured under serious disabilities.

Spanish trade.

In Spain, British ships were placed on a footing of equality with Spanish ships as regards all port and navigation dues, by a Royal order of September, 1852, having been, previously, subjected to heavy differential charges. But an excess of 20 per cent. was still levied on goods imported in foreign ships in the indirect trade, and, to this extent, British navigation was still unfairly treated there.

Portuguese trade.

Belgian trade.

Restrictions were also maintained in Portugal on foreign ships in the indirect and colonial trades. In addition to the case of the above three countries, it must be also mentioned that, in Belgium, there was still charged a duty of 1s. 1¼d. per 100 kilogrammes on salt, when imported in British vessels, while in Belgian and Sardinian ships this article was free. But, in spite of this disability, the total tonnage of the two countries, respectively, entered and cleared, with cargoes or in ballast, in the direct trade, was, in 1857, only 143,341 tons, while the British shipping employed in it that year amounted to upwards of 364,000 tons.

British ships in French and Spanish ports.

It was admitted that the pursuance of this restrictive policy would fully justify retaliation, more especially in the case of France and Spain; but the results exhibited in the appended Return[180] show that the trade transferable, by any such measure, from foreign to British ships was comparatively so small, as neither to operate as an inducement to the countries in question to relax their present system, nor to afford any material addition to British shipping. Another Return,[181] also, showing the total amount of British tonnage which entered and cleared in French and Spanish ports respectively in the indirect trade in each year, from 1853 to 1857 inclusive, proves, to how small an extent, the shipping of these countries engaged in the indirect trade with the United Kingdom; the result being, that, in spite of the unequal restrictions, there was a larger amount of British tonnage employed in the indirect trade with those countries, than of the tonnage of such countries, respectively, in the indirect trade of the United Kingdom, to which they were admitted on equal terms with British ships. Further, the accounts accessible in Portugal, however imperfect, were sufficient to afford conclusive evidence that the British flag in no respect suffered from the competition of that country. Indeed, the total tonnage of Portuguese ships which entered and cleared in the direct and indirect trades of the United Kingdom in 1857 was only 56,606 tons, whereas the British tonnage employed in the direct trade alone with Portugal amounted in the same year to 234,423 tons.

If a comparison were made between the relative employment of British and French tonnage in the whole trade of France and the United Kingdom, respectively, direct as well as indirect, it would appear that, in 1857, the total amount of British tonnage in French ports was equal to two-thirds of the French tonnage in its own ports; while, in the same year, the total French tonnage in British ports was, of course, in a very small proportion, indeed, to the amount of British tonnage in British ports, and considerably less than one-half of the amount of British tonnage at French ports. Similar results were shown in the case of Spain.

Coasting trade.

Previously to the opening[182] of the coasting trade of the United Kingdom, British ships were admitted on equal terms with the National ships in the coasting trades of Hanover, Belgium, Oldenburg, Mecklenburg, Holland, Turkey (except foreign steamers for the Bosphorus), Monte Video, Paraguay, New Granada, and China. But, in consequence of that measure, the coasting trades of Norway and Sweden, Denmark, Prussia, Sardinia, and Tuscany were, likewise, opened to British ships on the same footing as national vessels.

Non-reciprocating countries.

The coasting trade, however, of the following countries was still withheld from British ships, and reserved for the national flag, viz., France, Papal States, Two Sicilies, Russia, Austria, Spain, Portugal, Greece, United States of America (as regards goods), Mexico, Peru, Chili, Brazil, La Plata, Venezuela, and Hayti.

As in the case of foreign trade, the Queen, in the exercise of the powers vested in her, might, doubtless, with perfect justice, exclude the shipping of these countries from the coasting trade of the United Kingdom; but, in this branch of trade, even more than in that of foreign trade, such a measure would have proved almost wholly valueless to the shipping of the United Kingdom.

The tonnage of each foreign State, engaged in the coasting trade of the United Kingdom in the year 1857 was absolutely insignificant, and, for all practical purposes, is still virtually monopolised by British shipping.[183] It will be observed that, both in the foreign and in the coasting trades, the countries which have reciprocated the liberal policy of the United Kingdom are those which have most benefited by the repeal of our restrictions, while the countries which continue to maintain unequal restrictions on British ships, and against which, alone, any measure of retaliation could have been directed, are those which have derived little or no advantage from the opening of British trade.

There is one other case noticed in the Board of Trade Report to which it is desirable again to advert, in considering the question of reciprocity, as this case has been made the subject of frequent complaint, viz., the exclusion of British ships from the trade between the Atlantic and Pacific ports of the United States of America.

The Government of that country has reserved, as we have seen, this trade to the national flag. In this report it is stated that they have done so, on the ground of its being a Coasting trade; and that they are supported, by analogy, in several other countries under similar geographical conditions: for example, the trade between the Atlantic and the Mediterranean coasts of France and Spain.[184] And, further, that, with reference to the technical difficulty, it would not be competent for the Queen, under the retaliatory clauses alluded to, to exclude United States ships from any branch of British trade, except the coasting trade of the United Kingdom; and it had been shown that the share of this trade enjoyed by the United States was so small, that such a measure could neither injure the United States nor benefit British shipping.

Presumed advantage of the Panama route.

It was thought, moreover, that the value of this branch of trade on the American coast had been greatly overrated. In the first place, it was obvious that every year would diminish its importance if the surmise was correct that the bulk of the trade between the two sea-boards of the North American continent would shortly be carried across the Isthmus of Panama, and would thus, be placed at the disposal of British ships.[185]

Question discussed.

Whatever opinion may be formed concerning the validity of this comparison, the Board of Trade assured the Shipowners that the Queen’s Government had held on this question, that, although the inter-Oceanic trade of the United States might, in a strictly technical sense, be properly defined as a Coasting trade,[186] yet, on the broad ground of international equity, it should rather be regarded as analogous to the trade between the United Kingdom and her distant dependencies, and that British ships were, therefore, fairly entitled to participate in the former, in return for the complete assimilation of the United States to the British flag in the latter field of profitable employment.

It should, however, be remarked that, with reference to this question, the reservation of the coasting trade to national vessels does not appear to apply to the carriage of passengers; so that, as far as can be ascertained, foreign vessels lie under no disability in the transport of passengers coastwise from port to port of the United States of America.

Was the depression due to the withdrawal of Protection?

It remains now to inquire how far such depression can be, in truth, attributed to the withdrawal of protection from British shipping, and to the consequent unrestricted competition with the shipping of other countries; for it is, only, by an examination into general results, that any satisfactory conclusions upon this question can be arrived at.

Now it is inseparable from the nature of all great changes of system that particular interests must, occasionally, suffer from causes which contribute to the general good; it is, therefore, possible in this instance, that particular trades may have been injuriously affected, while the general interests of British shipping have been promoted.

The statistical accounts of British tonnage employed at any given time afford a very imperfect test of the actual condition of the shipping interest, the more so as shipping is often employed with very inadequate remuneration; but this remark does not apply to periods of time extending over several years; hence, the shipping returns of the nine years since the repeal of the Navigation Laws may be fairly held to supply sufficient evidence of the influence that measure has exercised on the permanent interests of British shipping.

Board of Trade report and returns.

Consequently a table was prepared by the Board of Trade to show the total aggregate tonnage of British and foreign vessels, respectively, entered and cleared, with cargoes and in ballast, at ports of the United Kingdom in each year from 1842 to 1857 inclusive, a period comprehending eight years before and eight years after the repeal of the Navigation Laws.[187]

English and foreign tonnage.

It will be seen from this table that during the first period British tonnage advanced from 6,699,995 tons in 1842 to 9,669,638 in 1849, being an increase of 2,969,643 tons.

In the second period it advanced from 9,442,544 tons in 1850 to 13,694,107 tons in 1857, being an increase of 4,251,563 tons.

In the same period the progress in the employment of foreign tonnage in the trade of the United Kingdom has been from 1842, 2,457,479 tons; to 1849, 4,334,750 tons; increase 1,877,271 tons. From 1850, 5,062,520 tons; to 1857, 9,484,685 tons; increase 4,422,165 tons.

It must be borne in mind, that these tables only show the state of the trades before the repeal was completely carried out for British and, partially so, to foreign ships, and that, in order to estimate the full effect of the measure on British shipping, it is necessary, also, to show the number of British ships built and registered during the respective periods.[188]

There are two features in these returns deserving special notice.

1st. According to the opinion of the Board of Trade this account shows a larger relative increase than that of the previous returns relating to the employment of tonnage, while it, at the same time, confirms the hypothesis that many British ships now find an employment in the indirect trade of foreign countries, which, of course, does not appear in the accounts rendered in England. Indeed, during the period of protection, there was an actual decrease in the amount of tonnage built and registered, while a large increase took place in the second period of open competition.

Sailing vessels and steamers in home and foreign trades.

The next account shows the number and tonnage of registered sailing and steam vessels of the United Kingdom employed in the home and foreign trades respectively (excluding repeated voyages).[189]

On this return it is to be observed that there has been a greater progress in the tonnage engaged in the foreign trade, where competition exists, than in the home trade, where, although that competition is also allowed by law, it is only carried out to a trifling extent in practice, the latter having only advanced from 719,815 to 860,406 tons, while the former has advanced from 2,089,037 to 3,168,105.

It now remains to consider the shipping accounts for 1858.[190] These exhibited a decline as compared with those of the preceding years, and to this extent gave indications of the depression of which Shipowners so much complained.

The accounts of December 1858 and January 1859,[191] if taken separately, showed that a favourable reaction had already commenced, and that British shipping was, in the spring of 1859, recovering from the depression it had suffered; and this fact was, naturally, much dwelt on by the champions of repeal, confirming, as it was supposed to do, the opinion expressed on the temporary and accidental character of this depression. This account, also, illustrates the state of the merchant shipping of England at a period preceding a continental war.

Foreign and Colonial trades.

It was pointed out with a certain degree of triumph, that these three accounts, when taken together, afforded satisfactory evidence that, down to the close of 1857, the progress of British shipping had suffered no check nor reverse, and that the great development of the foreign tonnage, employed in the trade of the United Kingdom during recent years, was only partly attributable to the repeal of the Navigation Laws in 1849, the progress of foreign shipping in British trade having been nearly as rapid in the period of eight years prior to 1850 in consequence of the increasing requirements of British commerce.

The reason of the decline exhibited in the accounts for 1858 must, therefore, be sought from other causes; and, probably, the commercial history of the previous few years is amply sufficient to afford the required explanation; moreover, any loss we might, thereby, have sustained was more than counterbalanced by the extraordinary development of the foreign and colonial trades of the United Kingdom during the ten years preceding 1859.[192]

Probable causes of the depression in England and America.

The commercial crisis, however, which occurred on both sides of the Atlantic, at the close of 1857, necessarily operated injuriously upon the progress of English trade, and consequently on English shipping. It must be also remembered that the Russian war, and, subsequently, the disturbances in British India, created a large and abnormal demand for tonnage, which ceased with the termination of those temporary causes; and, as tonnage employed exclusively in the Government transport service, does not appear in the preceding account, it is probable that, during 1858, there was a still greater check to the demand for tonnage than is therein expressed.

The temporary depression was, however, by no means confined to the shipping of the United Kingdom, as we have shown; similar symptoms had manifested themselves in other maritime countries.[193]

American jealousy and competition.

Although the competition of British shipping in steam navigation had been the subject of loud complaint in America, it will be found that the decline in the building and employment of British shipping in 1858 was not so great in proportion as that which was indicated by the annual accounts of the imports and exports of the United Kingdom for that year.[194]

Inconclusive reasoning of Board of Trade.

The Board of Trade argued, but very inconclusively, with reference to the free supply of foreign tonnage for the requirements of British trade, that if, during the exceptional circumstances of recent years, British commerce had been obliged to depend on British shipping alone to the extent which was necessary before 1850, an artificial stimulus would have been given to the demand for British ships, which could not have been sustained, and that, therefore, the whole weight of the reaction would have fallen upon British shipping, instead of being diffused, as was the case, among the whole tonnage employed in British trade.

Upon this preposterous conclusion no argument can be raised: as well might it be said that a man ought not to be individually prosperous, lest the revulsion of adversity should be too great for him, especially if not diffused among his rivals in trade. At last, Government arrived at this conclusion about the condition of merchant shipping, that they could not attribute the actual depression of British shipping to the effects of increased competition with foreign shipping consequent on the repeal of the Navigation Laws; but that, considering the importance of the shipping interest in a national point of view, it was desirable that all partial and unequal burdens to which the shipping interest was still subject should be removed as soon as practicable. In this spirit, the repeal of the differential duty on foreign timber as the raw material of shipbuilding, and the abolition of passing tolls and other local burdens, which were still maintained without any equivalent in the shape of services rendered to shipping, were questions which deserved immediate consideration.

Compulsory reciprocity no longer obtainable.

Government proposes to remove burdens on British shipping.

It cannot be denied that this very elaborate exposition of the state of merchant shipping completely cut the ground from under those Shipowners who still advocated Protection. They, however, went on cavilling “for a principle,” and contended that the Spanish and French trades for instance might become valuable to the British Shipowner if the Governments of France and Spain would adopt the liberal policy pursued by England towards them in this respect; whereas, under the existing restrictions, British Shipowners lost many valuable charters, and were prevented from completing voyages otherwise profitable. The Shipowners refused to allow the validity of the argument, that the British Shipowner carried on a greater business in the indirect trade with France and Spain than the French and Spanish Shipowners in the indirect trade with England, and that, therefore, retaliation would neither operate as an inducement to those countries to relax their system, nor afford material addition to the field of employment of British shipping. They contended that the commercial navy of this country was larger than that of France and Spain combined; that, therefore, the Shipowners of these countries had not the means of engaging in an oversea trade to the same extent as the Shipowners of England, and that, consequently, the superior energy of the British Shipowner ought not be pleaded as a barrier to an act of justice. Nor did it, in their opinion, follow that, because the engagement of the Spaniard and Frenchman in the indirect trade with England was not larger and more active than that of the British Shipowners in the indirect trade with France and Spain, there was no inducement to the Governments of those countries to relax the present restrictive system, and no prospect, in the event of such relaxation, of increased employment of British shipping in the direction indicated. In fact, the London Shipowners thought the argument was entirely the other way, and would not be convinced to the contrary, whatever relative prosperity they might enjoy.

Real value of the Coasting trade of the United States.

With regard to the Coasting trade, all parties were agreed that the Americans acted selfishly in denying to England the same reciprocity for the coasting trade, which she had unrestrictedly conceded to them. The Shipowners, however, by no means acquiesced in the opinion given by the Board of Trade, that “the value of the American Coasting trade had been greatly overestimated.” They said, and with reason, that it was an error to imagine that because San Francisco formed the limit of the United States’ coasting trade, the entrances and clearances at that port exhibited the entire amount of the trade along the American seaboard.

Magnanimity of England in throwing open her Coasting trade unconditionally not appreciated by the Americans.

It was, indeed, an evasion to say that the American coasting trade, meaning the western coast only, never afforded employment to more than 200,000 tons of American ships. The records of these pages afford proofs to the contrary. All mention of the trade between the ports of the Northern States and those of the Gulf of Mexico is, for some reason or other, suppressed. All the vast and lucrative carrying trade between New York and Boston, New Orleans and Mobile and Charleston, is studiously kept out of view; trades far more valuable than that of San Francisco and of the whole western coast, collectively. The argument, therefore, set up by the Board of Trade, “that the participation of the Californian trade, however desirable, cannot be regarded as a circumstance which could exercise any important influence on the shipping interests of Great Britain,” was altogether unsatisfactory. Magnanimous as it was of the English Legislature to throw open the foreign, as well as the colonial commerce and navigation of the Empire, and the coasting trade afterwards, without imposing any previous conditions, such a liberal policy has, evidently, been unappreciated by the Americans, who seem resolved to monopolise all advantages resulting from their geographical position.