No. 33.
Mr. Kasson
to Mr. Evarts.
Vienna, February 9, 1880. (Received February 25.)
Sir: The increase in ownership of railroads by the States of Europe has rendered necessary a new clause in commercial treaties. The adjustment by the governments of railway transportation tariffs has become of like importance to the adjustment of the tariffs upon the importation of merchandise. The acquisition of trunk lines of railway by Prussia has given to that government an important influence over the foreign commerce of Austria-Hungary, much of which finds inlet and outlet across Germany, at the ports of Bremen and Hamburg, especially the Austrian commerce with the United States.
Most of the great lines of Austria-Hungary are, or will soon be, under, the control of the state, as reported in my No. 195. Hence arise new questions to be adjusted in the commercial treaty at this moment pending between the two empires, and upon the terms of which they have not yet found it possible to agree.
You will have already observed that there is a marked tendency on the continent of Europe to secure to the governments either the absolute [Page 49] ownership or the right of control of all important railroads; and this not merely with reference to military considerations, but peculiarly with reference to the point d’appui it affords in establishing and regulating international commercial relations. Transit countries especially utilize this as means to force concessions from the countries of destination, as Austria-Hungary from Servia, and Germany from Austria, and vice versa.
It seems to merit your attention because the movement is based upon a system of state railways which is always growing, and because it may seem to you necessary to take steps by revised treaties, or other new arrangements, to guard against embarrassments which are likely to come upon American exports in transit, arising from the marked vigilance with which European governments are observing the increase of American competion in the markets which they have hitherto largely controlled.
If Canada were excluded from direct access to the Atlantic Ocean, and the United States Government owned all the railway lines, it will be seen how easily the Canadian exports and imports, would be placed in a condition of inferiority to the American by the simple expedient of a transportation tariff. A control of this sort is sought now by the continental powers of Europe.
Slight as its importance may be to us in our relations to the Danubian principalities, where also the state will own the railways, I have introduced expressions into the projected treaties to guard American merchandise in transit against the prejudice to which it might otherwise be exposed.
I have, &c.,