Matson Subsidy Reduced

American Liners

From Our Own Correspondent

Honolulu, Aug. 2.

THE American Government, as from July, has drastically reduced the payments made to the Matson Line for carrying mails between America and Sydney, according to an announcement by the U.S. Maritime Commission.

President Roosevelt ordered that the truth be admitted: the huge payments formerly made were called mail con tracts, but he insists they have been straight out subsidies, because the amount of mail carried has been negligible compared with the millions of dollars paid out.

Under the new subsidy plan, the Mat son Line will be paid only $287,000 for a period of six months instead of $428,000 at the old rate. At the end of every six months the Government will revise the payment according to actual operating results.

Because the companies concerned owe the Government so much money for con struction loans during the open-handed Hoover regime, the Government is delay ing agreements with other steamship companies. Thus affected are the Matson liners trading between the mainland and Hawaii. Also affected is the Dollar Com pany, which owes the Government $15,000,000 according to the Commission.

It was announced, too, that the Com mission is investigating wage scales and working conditions, and has arranged for conferences between the union leaders and the companies. The Commission, through the post office laws, has the right to insist upon the companies treating the labour right if subsidies are accepted.