Shipbuilding - Government Policies
Though of doubtful advantage from the point of view of the immediate interests of the German Fleet, General von Stosch's rule that all the Imperial war vessels should be constructed in home yards and of native material unquestionably did a great deal to stimulate shipbuilding in Germany. Another measure which contributed much to the same end was the subsidization of the mail lines to the Far Orient, Australia, and East and South Africa. It has always been maintained by German authorities that the sums paid by the Government under the postal contracts are not really subsidies, and that they had neither the intention nor the effect of promoting shipping. Their sole purpose, it is contended, was to establish a regular mail service between Germany and portions of the globe where she had important commercial interests.
Without entering upon debatable economic questions it may be asserted as a fact that German shipbuilding is a State-developed industry. Little was done until von Stosch, Minister of the Navy, in introducing a Bill for the establishment of a German Navy defined once for all the relations between the German Navy and the German industries. Not only did the State give assistance by the placing of orders, but further assistance was afforded in 1879 by the exemption from import duty of mercantile shipbuilding materials, a concession the importance of which was recognised when the Norddeutscher Lloyd placed an order with the Vulcan yard in 1886 for six imperial mail steamers for the East Asiatic and Australian lines. These were the first large iron passenger steamers built in Germany. Being Government mail steamers, German material was to be used in their construction as far as possible.
The German Reichstag passed a law, on April 6, 1885, under which on July 3, 1885, the German Government contracted to pay annually for fifteen years to the North German Lloyd Company 4,090,000 marks ($973,420) for steamship lines to Asia and Australia. In 1898 this subsidy was increased to 5,590,000 marks ($1,330,420). Beginning with April 1, 1908, this subsidy was increased to 5,820,000 marks ($1,385,160). The changes in the subsidy, of course, have been accompanied by larger and faster steamships and by extension of the lines of communication.
One of the earliest results, if not purposes, of this policy established under Prince Bismarck, was the virtual creation of the industry of ocean-steamship building in Germany. With the bill submitted to the Reichstag by Prince Hohenlohe in 1898 for the increase of the North German Lloyd subsidy was a very complete report of the operations of the contract of 1885. In this German report it is stated that on the completion of the contract a German shipyard, the Stettin-Vulcan, with skill and experience had laid the foundation of a new industry by building ships for the oriental trade as well as fast steamships to the United States; that other shipyards sprang into existence, among the foremost that of Schichau, in Dantzic, and Blohm & Voss; and that " all experts assert that without the influence of the government ocean-mail service such a steamer as the Kaiser Wilhelm der Grosse could not have been built." Indeed the argument in 1898 for the revision of the German subsidy of 1885 is pertinent to our own situation.
That report stated : "It was decided by the establishment of an Imperial mall-ocean service that our commerce by sea called for quicker, more direct, and more regular transportation In order to make it more efficient, and, above all, to compete with foreign enterprise. That this need for the long voyage to eastern Asia and Australia could be met, not as In the case of relatively short voyages to America by German shipping without government assistance, but that such navigation, on account of Its expense, should be promoted by state aid, is shown In the amendment to the steam mail act of the 20th of November, 1884. And experience has proved the truth of that view. Quick and well-managed, regular steam communication - experience has taught - is the backbone of oversea navigation. It is indispensable to passenger and postal travel; by its speed and regularity it does most to encourage commerce in the greatest and smallest industries. The closer and greater the connection between the commerce and Industries of two countries the greater the need for steam navigation. In the attainment of this necessity, Germany, with her steadily crowing industries and constant increase of power among the nations, should no longer remain under the protection of alien flags, but beneath her own flag and with her own steam navigation should bring her home products to a prominent position."
That the Government was not exclusively concerned for the carrying of letters when it proposed these contracts was shown by the clauses providing for the transformation of the mail steamers into auxiliary cruisers in time of war. All the fastest steamers of the German lines were constructed with a view to such a contingency; their engines were protected against lighter shell fire, platforms were provided for the mounting of quick-firers, and the guns themselves were kept in readiness, if not actually on board, so that the change from merchant-ship to warship can be accomplished with a minimum of delay.
A large number of the officers of these liners belonged to the Naval Reserve, and the Emperor, here again taking a leaf out of the British book, allowed them to bear the iron cross, the German war emblem, on their flag. On 1 July 1896, a special merchant ensign for ships commanded by retired and reserve naval officers entitled the Handelsflagge mit Eisernem Kreuz was decreed. It consisted of the black-white-red merchant flag with at center of the hoist an iron cross whose height was 5/9 that of the flag. As was the case with the reserve officers of the British Navy, they also derived various other privileges from their connection with the Imperial sea service.
The Navy Act of 1900 gave the German shipbuilders the assurance of future orders, which was necessary to induce them to run the risk of laying down the plant required for the construction of ships of the largest classes. From the date of the passing of that measure, it was known that for all future time the Imperial Ministry of Marine would require the annual delivery of at least three capital warships, and the yards had a definite justification for large capital outlay. What was hoped was that with the aid of the experience thus gained, they will be able to enter more successfully into competition with the United Kingdom for the naval orders of those States that cannot build their war vessels for themselves. On the degree of the fulfilment of these hopes would depend to a very large extent the issue of the struggle for the supremacy of the seas.
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