sary to advance considerable sums, before the service commenced, to aid the contractors in constructing their vessels. Under the obligations of these several contracts, annual appropriations are made for payment to the contractors. For the line between New-York and Liverpool, an annual compensation of three hundred and ninety thousand dollars was not deemed unreasonable; and the contract when fully executed will make available for public use only five first class steamers.
A plan different from those already stated is now proposed. Instead of an annual appropriation to pay the contractor for carrying the mails, he proposes to receive only the postages, and look to this source with the freights he may be able to command by the superior condition of his ships, and to skill and economy in their management, for his reward. But the outlay for construction is to be provided by the issue of Government scrip, made in advance, but redeemable after the service has been performed. No payment from the Treasury will be required to meet the accruing interest on the scrip, for the contractor is required to give satisfactory security that he will meet this liability; and the redemption of the stock by him, if the Government shall not appropriate the ships to its own use, is secured by a mortgage on the ships which the strongest motives of interest will impel the contractor to construct and equip in the most perfect manner, and keep constantly in the most serviceable condition. If he fail to do either, he must be utterly ruined, under the obligations of his contract; and if likely to fail in his duty in this respect, the Government may at all times compel him to perform it or abrogate the contract, taking to itself the entire property in the Steamships. It can only be regarded as a contract by which the Government secures great public advantages, and by which the ships are in effect the property of the Government, and the scrip as only its promise to pay the cost of construction and equipment, when the service has been performed, and the ships are required for naval purposes; while the Government will secure by its powers of supervision that the funds will be faithfully applied to the purposes of the contract. The practical effect of the arrangement will be that the Government will have in actual service ten first-class Steamships, without expense for the service, or for maintaining and repairing them, with every possible assurance that they will be kept in the most serviceable condition, and subject to be taken for its use at its pleasure. The obligation to pay at a future day cannot exceed the cost of construction and equipment, and its lieu on the ships cannot be evaded or defeated.
In every view of the subject, the committee regard it as a most favorable contract for the Government; and the fact that a citizen of character, and an enterprising and successful man of business, is willing to devote his time and energy to an enterprise in which his reward will depend on the successful employment of the ships as carriers of freights, tends strongly to show that the routes are well selected—that the commerce of the country will be greatly extended—and that the Government will not be in danger of finding its vessels, at any time, in a neglected or unserviceable condition.
Strongly impressed with the belief that the system is wise, that the
