The merchant marine was one sector of the otherwise booming Gilded Age economy that was in decline. In the 1850s more than 70 percent of American exports and imports were shipped in American vessels, but by 1897 only 15 percent of the value of imports and 8 percent of the value of exports were carried by American ships. The decline began in 1863, during the Civil War, and steadily continued thereafter. By 1870 American ships totaling approximately 2.5 million tons entered and cleared American seaports, as compared with a tonnage for foreign vessels of about 3.8 million. By 1900 American tonnage entering and clearing U. S. seaports was 4 million, while foreign tonnage leaped to 19.6 million.
The most obvious reason for the decline is the Civil War, which is indeed when it first set in. Confederate raiders sank about 800,000 tons of American ships, which jacked up insurance rates and prompted owners to sell an even larger tonnage to foreigners to be operated under neutral flags. But in the past seafaring nations have suffered depredations to their commerce and have rebuilt their merchant marine in times of peace to reclaim their share of the carrying trade. The Civil War is partly responsible but probably not even the major reason for the longterm decline.
By the time of the Civil War technological innovations were fundamentally altering ships. Canvas sails and wooden vessels were being supplanted by steam engines in iron and later steel hulls. The change did not occur overnight because, where speed was not of critical importance, sailing vessels remained cost effective throughout the Gilded Age in shipping bulky goods like coal or timber. But as time went on, steam engines improved in efficiency, taking up less space, producing more power, and burning less coal; steel hulls provided more capacious holds; and the industrial world demanded celerity, punctuality, and predictability.
With an ample supply of timber, Americans had excelled in constructing wooden sailing ships. Their clipper ships of the 1850s were the fastest sailing vessels afloat. American shipbuilders were on the cutting edge of wood and sail, but not of iron and steam. During the Gilded Age American shipbuilders did build iron - and steel-hulled steamships, but their labor costs were significantly higher than those of British shipbuilders. The efficiency that made Americans preeminent as steel producers was absent in their shipyards, where vessels were not mass-produced. American shipowners did not buy foreign-built ships because by law only American-built ships could be registered as American. Not only were American ships more expensive to build than foreign vessels, but they also were more costly to operate. Lower costs for operators of foreign ships meant lower freight rates than those Americans charged and resulted in steadily increasing shipments in foreign bottoms.
The decline of the merchant marine rankled patriotic Americans, who sensed that “effeminacy” and “decadence” would surely follow. To reverse the trend Congress provided subsidies in the form of lucrative mail contracts and in 1891 passed a Merchant Marine Act that gave bounties per mile on certain outward-bound routes. Subsidies, however, were ineffective in stemming the drift to shipping in foreign vessels, and Americans, who supported an indirect subsidy in the form of a protective tariff, were reluctant to provide significant direct support to the American shipowners.
Further reading: K. Jack Bauer, A Maritime History of the United States: The Role of America's Seas and Waterways (Columbia: University of South Carolina Press, 1988); Andrew Gibson and Arthur Donovan, The Abandoned Ocean: A History of United States Maritime Policy (Columbia; University of South Carolina Press, 2000); Edward C. Kirkland, Industry Comes of Age: Business, Labor, and Public Policy, 1860-1897 (New York: Holt, Rinehart and Winston, 1961); Benjamin W. Labaree, America and the Sea: A Maritime History (Mystic, Conn.: Mystic Seaport, 1988).
World History
