CHAPTER I
INTRODUCTORY
The term subsidy, defined in the dictionaries as a Government grant in aid of a commercial enterprise, is given different shadings of meaning in different countries. In all, however, except Great Britain, it is broadly accepted as equivalent to a bounty, or a premium, open or concealed, directly or indirectly paid by Government to individuals or companies for the encouragement or fostering of the trade or commerce of the nation granting it.
Ship subsidies are in various forms: premiums on construction of vessels; navigation bounties; trade bounties; fishing bounties; postal subsidies for the carriage of ocean mails; naval subventions; Government loans on low rates of interest.
In Great Britain they comprise postal subsidies and naval subventions, ostensibly payments for oversea and colonial mail service exclusively, or compensation for such construction of merchant ships under the Admiralty regulations as will make them at once available for service as armed cruisers and transports. They are assumed to be not bounties in excess of the actual value of the service performed, with the real though concealed object of fostering the development of British overseas navigation. Still, notwithstanding this assumption, such has been their practical effect.
Their original objects when first applied to steamship service, as defined by a Parliamentary committee in 1853, were—"to afford us rapid, frequent, and punctual communications with distant ports which feed the main arteries of British commerce, and with the most important of our foreign possessions; to foster maritime enterprise; and to encourage the production of a superior class of vessels, which would promote the convenience and wealth of the country in time of peace, and assist in defending its shores against hostile aggression." To foster British commerce they have undeniably been employed to meet and check foreign competition on the seas, as the record shows.
In the United States they have taken the form of postal subsidies openly granted for the two-fold purpose of the transportation of the ocean mails in American-built and American-owned ships, and the encouragement of American shipbuilding and ship-using.