Bernhard Huldermann

The principal work which fell to Ballin’s share during the period immediately following his nomination in 1888 on the Board of his company was that connected with the introduction of the fast steamers and the resulting expansion of the passenger business. Offices were established in Berlin, Dresden, and Frankfort-On-Main in 1890, and arrangements were made with the Hamburg-South American S.S. Co., the German East Africa Line, and the Hansa Line—the latter running a service to Canada—by which these companies entrusted the management of their own passenger business to the Packetfahrt. Thus, step by step, the passenger department developed into an organization the importance of which grew from year to year.

The expansion of the passenger business also necessitated an enlargement of the facilities for the dispatch of the Company’s steamers. This work had been effected until then at the northern bank of the main Elbe, but in 1888 it was transferred to the Amerika-Kai which was newly built at the southern bank; and when the normal depth of the fairway of the Elbe was no longer sufficient to enable the fast steamers of considerable draught to come up to the city, it was decided to dispatch them from Brunshausen, a small place situated much lower down the Elbe. In the long run, however, it proved very inconvenient to manage the passenger dispatch from there, and the construction of special port facilities at Cuxhaven owned by the Company was taken in hand. The accommodation at the Amerika-Kai, although it was enlarged as early as 1889, was soon found to be inadequate, so that it was resolved to provide new accommodation at the Petersen-Kai, situated on the northern bank of the Elbe, and this project was carried out in 1893.

The number of services run by the Company was augmented in those early years by the establishment of a line to Baltimore and another to Philadelphia. In 1889 a new line starting from New York was opened to Venezuelan and Colombian ports. The North Atlantic services were considerably enlarged in 1892, when the Company took over the Hansa Line.

The desire to find remunerative employment for the fast steamers during the dead season of the North Atlantic passenger business prompted the decision to enter these boats into a service from New York to the Mediterranean during the winter months. The same desire, however, also gave rise to one of the most original ideas carried into practice through Ballin’s enterprise, i.e. the institution of pleasure trips and tourist cruises. It may perhaps be of interest to point out in this connexion that, about half a century earlier, another Hamburg shipping man had thought of specially fitting out a vessel for an extended cruise of that kind. I do not know whether this plan was carried out at the time, and whether Ballin was indebted to his predecessor for the whole idea; in any case, the following advertisement which appeared in the Leipziger Illustrierte Zeitung, and which I reprint for curiosity’s sake, was found among his papers.

"An Opportunity for Taking Part in a Voyage
Round the World

“The undersigned Hamburg shipowner proposes to equip one of his large sailing vessels for a cruise round the world, to start this summer, during which the passengers will be able to visit the following cities and countries, viz. Lisbon, Madeira, Teneriffe, Cap Verde Islands, Rio de Janeiro, Rio de la Plata, Falklands Islands, Valparaiso, and all the intermediate ports of call on the Pacific coast of South America as far as Guayaquil (for Quito), the Marquesas Islands, Friendly Islands (Otaheite), and other island groups in the Pacific, China (Choosan, Hongkong, Canton, Macao, Whampoa), Manilla, Singapore, Ceylon, Île de France or Madagascar, the Cape of Good Hope, St. Helena, Ascension Island, the Azores, and back to Hamburg.

“The cruise is not intended for business purposes of any kind; but the whole equipment and accommodation of the vessel, the time spent at the various ports of call, and the details of the whole cruise, are to be arranged with the sole object of promoting the safety, the comfort, the entertainment, and the instruction of the passengers.

“Admission will be strictly confined to persons of unblemished repute and of good education, those possessing a scientific education receiving preference.

“The members of the expedition may confidently look forward to a pleasant and successful voyage. A first-class ship, an experienced and well-educated captain, a specially selected crew, and a qualified physician are sufficient guarantees to ensure a complete success.

“The fare for the whole voyage is so low that it only represents a very slight addition to the ordinary cost of living incurred on shore. In return, the passenger will have many opportunities of acquiring a first-hand knowledge of the wonders of the world, of the beautiful scenery of the remotest countries, and of the manners and customs of many different nations. During the whole voyage he will be surrounded by the utmost comfort, and will enjoy the company of numerous persons of culture and refinement. The sea air will be of immeasurable benefit to his health, and the experience which he is sure to gain will remain a source of pleasure to him for the rest of his life.

“Full particulars may be had on application to the undersigned, and a stamped envelope for reply should be enclosed.

“Rob. M. Sloman,

“Hamburg, January, 1845. Shipowner in Hamburg.”

Ballin’s idea of running a series of pleasure cruises did not meet with much support on the part of his associates; the public, however, took it up with enthusiasm from the very start. Early in 1891 Ballin himself took part in the first trip to the Far East on board the express steamer Auguste Victoria. Organized pleasure trips on a small scale were by no means an entire novelty in Germany at that time; the Carl Stangen Tourist Office in Berlin, for instance, regularly arranged such excursions, including some to the Far East, for a limited number of participants. To do so, however, for as many as 241 persons, as Ballin did, was something unheard-of until then, and necessitated a great deal of painstaking preparation. Among other things, the itinerary of the intended cruise, owing to the size and the draught of the steamer used, had to be carefully worked out in detail, and arrangements had to be made beforehand for the hotel accommodation and for the conveyance of passengers during the more extended excursions on shore. All these matters gave plenty of scope to the organizing talents of the youthful director, and he passed the test with great credit.

The first Far Eastern cruise proved so great a success that it was repeated in 1892. In the following year it started from New York, surely a proof that the Company’s reputation for such cruises was securely established not in Germany alone, but in the States as well. Meanwhile, however, Hamburg had been visited by a terrible catastrophe which enormously interfered with the smooth working of the Company’s express steamer services. This was the cholera epidemic during the summer of 1892. It lasted several weeks, and thousands of inhabitants fell victims to it. Those who were staying in Hamburg in that summer will never forget the horrors of the time. In the countries of Northern Europe violent epidemics were practically unknown, and the scourge of cholera especially had always been successfully combated at the eastern frontier of Germany, so that the alarm which spread over the whole country, and which led to the vigorous enforcement of the most drastic measures for isolating the rest of Germany from Hamburg, may easily be comprehended, however ludicrous those measures in some instances might appear. There are no two opinions as to the damage they inflicted on the commerce and traffic of the city. The severest quarantine, of course, was instituted in the United States, and the passenger services to and from Hamburg ceased to be run altogether, so that the transatlantic lines decided to temporarily suspend the steerage pool agreement they had just concluded. The Packetfahrt, in order not to stop its fast steamer services completely, first transferred them to Southampton, and afterwards to Wilhelmshaven, thus abstaining from dispatching these boats to and from Hamburg. The steerage traffic had to be discarded entirely, after an attempt to maintain it, with Stettin as its home port, had failed. Financially this epidemic and its direct consequences brought the Company almost to the verge of collapse, and the Packetfahrt had to stop altogether the payment of dividends for 1892, 1893, and 1894.

Business was resumed in 1893, but at first it was very slow. Every means were tried to induce the United States to rescind her isolation measures. An American doctor was appointed in Hamburg; disinfection was carried out on a large scale; with great energy the city set herself to prevent the recurrence of a similar disaster. The Packetfahrt, in conjunction with the authorities, designed the plans for building the emigrants’ halls situated at the outskirts of the city, which are unique of their kind and are still looked upon as exemplary. These plans owe their origin to the extremely talented Hamburg architect, Mr. Thielen, whose early death is greatly to be regretted.

An important innovation was the establishment of regular medical control and medical treatment for the emigrants from the East of Europe on their reaching the German frontier, a measure which was decided upon and taken in hand by the Prussian Government. The expansion of the Packetfahrt’s business, of course, was most adversely affected by the epidemic and its after-effects; and several years of consolidation were needed before the latter could be overcome. Consequently, hardly any new services were opened during the years immediately following upon the epidemic.

An important step forward, which greatly strengthened the earning capacities of the Company’s resources, was taken in 1895, when the building orders for the steamers of the “P” class were given. These vessels were of large size but of moderate speed. They were extremely seaworthy, and were capable of accommodating a great many passengers, especially steeragers, as well as of carrying large quantities of cargo. The number of services run by the Company was added to in 1893 by a line from New York to Italy, and in the following year by one from Italy to the River Plate. Pool agreements were concluded with the Lloyd and the Allan Line with respect to the first-named route, and with the Italian steamship companies with respect to the other. The agreement with the Italians, however, did not become operative until a few years afterwards.

In 1897 the Packetfahrt celebrated the fiftieth anniversary of its existence—an event in which large sections of the public took a keen interest. Perhaps the most noteworthy among the immense number of letters of congratulation which the Company received on that occasion is the one sent by the chairman of the Cunard Line, of which the verbatim text is given below. It was addressed to one of the directors in reply to an invitation to attend the celebrations in person.

“It is with great regret I have to announce my inability to join with you in celebrating the fiftieth anniversary of the foundation of your Company, to be held on board your s.s. Auguste Victoria.

“I the more regret this as I have the greatest possible admiration of the skill and enterprise which has directed the fortunes of your Company, especially in recent years.

“You were the first to give the travelling public the convenience of a speedy and reliable transit between the two great continents of the world by initiating a regular service of twin-screw steamers of high speed and unexceptionable accommodation.

“You also set the shipping world the example of the great economy possible in the transit of the world’s commodities in vessels of greatly increased capacity and proportionate economy, which other nations have been quick to follow and adopt to their great advantage.

“Your Company had furthermore met a felt want in giving most luxurious and well-appointed accommodation for visiting scenes, both new and old, of world-wide interest, and making such journeyings, hitherto beset with anxiety and difficulty, as easy of accomplishment as the ordinary railway journey at home.

“You have succeeded in this, not through any adventitious aids, such as Government subsidies, but by anticipating and then meeting the wants of the travelling and commercial public; and no one, be his nationality what it was, can, in the face of such facts, abstain from offering his meed of praise to the foresight, acumen, and ability that have accomplished such great results in such a comparatively small time as the management and direction of the Hamburg-American Packet Company.

“I would venture, therefore, to thus congratulate you and your colleagues, and whilst reiterating my regret at being prevented from doing so at your forthcoming meeting, allow me the expression of the wish that such meeting may be a happy and satisfactory one, and that a new era of, if possible, increased success to the Hamburg-American Packet Company may take date from it.”

Towards the latter end of the ’nineties, at last, a big expansion of the Company’s activities set in. In 1897 the Hamburg-Calcutta Line was purchased, but the service was discontinued, the steamers thus acquired being used for other purposes. Shortly before the close of the same year a suggestion was put forward by some Hamburg firms that were engaged in doing business with the Far East that the Packetfahrt should run a service to that part of the world.

Just then the steamship companies engaged in the Far Eastern trade were on the point of coming to a rate agreement among themselves; and the management of the Packetfahrt which, owing to the offer held out to it by Hamburg, Antwerp, and London firms, could hope to rely on finding a sure basis for its Far Eastern business, did not consider it wise to let the favourable opportunity slip. Quick decision and rapid action, before the proposed agreement of the interested lines had become an accomplished fact, were necessary; because, once the gates were closed, an outsider would find it difficult to gain admission to the ring.

Hence the negotiations with a view to the Packetfahrt joining in the Far Eastern business, which had only been started during the second half of December, 1897, came to a close very soon; and in the early days of January, 1898, the Packetfahrt advertised its intention of running monthly sailings to Penang, Singapore, Hongkong, Shanghai, Yokohama, and Hiogo. Six cargo steamers of 8,000 tons burden were entered into the new service; and simultaneously an announcement was made to the effect that large fast passenger boats would be added to it as soon as the need for these should make itself felt.

The participation in the Far Eastern business, and the consequent taking over of competing lines or the establishment of joint services with them, was not the only important event of the year 1898 as far as the development of the Packetfahrt is concerned. In the spring of that same year an agreement was made with the Philadelphia Shipping Company—which, in its turn, had an agreement with the Pennsylvania Railroad Company—by which the Packetfahrt undertook to run a regular service of cargo steamers between Hamburg and Philadelphia.

An event of still greater importance, however, was the outbreak of war between the United States and Spain which also took place in that year. The Spanish Government desired to strengthen the fighting power of its navy by the addition of several auxiliary cruisers; and even some time before the war broke out an offer reached the Packetfahrt through the intermediary of a third party to purchase its two express steamers, Columbia and Normannia, which were among the fastest ocean-liners afloat. Before accepting this offer, the Packetfahrt, in order to avoid the reproach of having committed a breach of neutrality, first offered these two steamers to the United States Government; but on its refusal to buy them, they were sold to the British firm acting on behalf of the Spanish Government, and re-sold to the latter. As the Packetfahrt had allowed a high rate of depreciation on the two boats, their book-value stood at a very low figure; and the considerable profit thus realized enabled it to acquire new vessels for the extension of its passenger services.

Meanwhile a new express steamer, the Kaiser Wilhelm der GrÖsse, had been added to the fleet of the North German Lloyd. Ballin, having made a voyage on board this vessel to New York, reported to the Trustees of his Company that he considered her a splendid achievement. Owing to the heavy working expenses, however, she would not, he thought, prove a great success from a financial point of view. He held that the remunerativeness of express steamers was negatived by the heavy working expenses and, as early as 1897, had projected the construction of two steamers of very large proportions, but of less speed. This, however, was not carried out. Instead, the Packetfahrt decided to build a vessel which was to be bigger and faster still than the Kaiser Wilhelm der GrÖsse. The new liner was built by the Stettin Vulkan yard, and completed in 1900. She was the Deutschland, the famous ocean greyhound, a great improvement in size and equipment, and she held the blue riband of the Atlantic for a number of years.

About the same time, the express service to New York had been supplemented by the inauguration of an additional passenger service on the same route, which proved a great success in every way. The steamers employed were the combined passenger and cargo boats of moderate speed of the “P” class referred to above; and, their working expenses being very low, they could carry the cargo at very low rates, so that they proved of great service to the rapidly expanding interchange of goods between Germany and the United States. Their great size made it necessary to accelerate their loading and discharging facilities as much as possible. This necessity, among other things, led to the introduction of grain elevators which resulted in a great saving of time, as the grain was henceforth no longer discharged in sacks, but loose. The Company also decided to take the loading and discharging of all its vessels into its own hands. To accelerate the dispatch of steamers to the utmost possible extent, it was decided in 1898 to enlarge once again the Company’s harbour facilities, and an agreement was concluded with the Hamburg Government providing for the construction of large harbour basins with the necessary quays, sheds, etc., in the district of KuhwÄrder on the southern banks of the Elbe.

It was typical of Ballin’s policy of the geographical distribution of risks and of the far-sighted views he held concerning the international character of the shipping business that he attempted at the end of the ’nineties to gain an extended footing abroad for the Company’s activities. The Packetfahrt therefore ordered the building of two passenger boats in Italian yards, and it was arranged that these vessels should fly either the German or the Italian flag. In the end, however, a separate Italian shipping company, the Italia, was set up, which was to devote itself more particularly to the River Plate trade. When the financial results of the new enterprise failed to come up to expectations, the shares were sold to Italian financiers in 1905.

The closing years of the nineteenth and the opening years of the twentieth century represented a period of extraordinary prosperity to shipping business all over the world—a prosperity which was caused by the outbreak of the South African war in 1899. An enormous amount of tonnage was required to carry the British troops, their equipment, horses, etc., to South Africa, and the circumstance that this tonnage temporarily ceased to be available for the needs of ordinary traffic considerably stiffened the freight rates. The favourable results thus obtained greatly stimulated the spirit of enterprise animating the shipping companies everywhere.

About the same time the business of the Company experienced a notable expansion in another direction. A fierce rate war was in progress between the Hamburg-South American S.S. Co. and the firm of A. C. de Freitas & Co., and neither party seemed to be able to get the better of the other. As early as 1893 Ballin, on behalf of the Hamburg-South American S.S. Co., had carried on some negotiations with the firm of de Freitas with the object of bringing about an amalgamation of the two companies with respect to their services to Southern Brazil. In 1896 he had done so again in compliance with the special request of Mr. Carl Laeisz, the chairman of the former company, and in 1898 he did so for the third time, but in this case on his own initiative. No practical results, however, were reached, and as Ballin was desirous of seeing an end being put to the hopeless struggle between the two rival firms, he took up those negotiations for the fourth time in 1900, hoping to acquire the de Freitas Line for his own Company. He was successful, and an expert was nominated to fix the market value of the fourteen steamers that were to change hands. As the valuation took place at a time when the shipping business was in an exceedingly flourishing state, the price which he fixed worked out at so high an average per ton as was never again paid before the outbreak of the war. The valuer told me that he himself considered the price very high, so that he felt in duty bound to draw Ballin’s attention to it beforehand. Ballin tersely replied: “I know, but I want the business,” thus making it perfectly clear that he attached more than ordinary importance to the deal.

As soon as the purchase of the de Freitas Lines had become an accomplished fact, arrangements were made with the Hamburg-South American S.S. Company, which provided for a joint service to South America, a service which was still further extended when the Packetfahrt bought up a British line trading from Antwerp to the Plate, thus also securing a footing at Antwerp in connexion with its South American business. The necessity for taking such a step grew in proportion as Antwerp acquired an increasing importance owing to the increasing German export business.

Perhaps there is no country which can be served by the seaports of so many foreign countries as Germany. Several Mediterranean ports attract to themselves a portion of the South German trade; Antwerp and some of the French ports possess splendid railway connexion with Southern and Western Germany, and both Antwerp and Rotterdam are in a position to avail themselves of the highway of the Rhine as an excellent means of communication with the whole German hinterland. Finally, it must be remembered that the Scandinavian seaports are also to a certain extent competing for the German business, especially for the trade with the hinterland of the Baltic ports of Germany. All this goes to show that the countries surrounding Germany which have for centuries striven to exercise a kind of political hegemony over Germany—or, rather, generally speaking, over Central Europe—are not without plenty of facilities enabling them to try to capture large portions of the carrying trade of these parts of Europe. This danger of a never-ending economic struggle which would not benefit any of the competing rivals was the real reason underlying Ballin’s policy of compromise. He clearly recognized that any other course of action would tend to make permanent the existing chaos ruling in the realm of ocean shipping.

In this struggle for the carrying trade to and from Central Europe the port of Antwerp occupied a position all by itself. The more the countries beyond the sea were opened up by the construction of new railways and the establishment of industrial undertakings, and the more orders the manufacturers in the Central European countries received in consequence of the growing demand, the greater became the value of Antwerp to the shipping companies in every country. In this respect the early years of the twentieth century witnessed an extraordinary development, which, in its turn, benefited the world’s carrying trade to an ever-increasing extent. Never before had so much European capital been invested in overseas countries. Again, as a result of the Spanish war the political and economic influence of the United States had enormously expanded in the West Indian islands, whilst, at the same time, the Monroe doctrine was being applied more and more thoroughly and systematically. Consequently the attention of the American investors was also increasingly drawn towards those same countries. In Central America new railway lines were constructed by British and American capital, including some right across the country from the Atlantic to the Pacific, thus considerably facilitating trade with the Pacific coast of America. Other lines were built in Brazil and in the Argentine, and harbour and dock facilities were constructed in nearly all the more important South American ports. French and Belgian capital shared in these undertakings, and some German capital was also employed for the same purpose. The Trans-Andine railway was completed, and numerous industrial works were added to the existing ones. The great economic advance was not exclusively restricted to South America; it extended to the Far East, to the great British dominions beyond the sea, especially to Canada and Australia, and—after the close of the South African War—to Africa also. Russia built the great Trans-Siberian railway, and Germany commenced to exploit the resources of her colonies. As a result of all these activities the iron and steel manufacturers were overwhelmed with export orders. This applies particularly to the German iron and steel manufacturers, whose leading organization, the Stahlwerks-Verband, largely favoured the route via Antwerp, because it was the cheapest, to the great detriment of the German ports. Thus the German shipowners were compelled to follow the traffic, and the importance of Antwerp increased from year to year. The Hamburg-Amerika Linie met this development by opening a special branch office for dealing with the Antwerp business.

In 1899, a year before the Hamburg-Amerika Linie established itself in the services to Brazil and the River Plate, a line had been started by the Company to Northern Brazil and the Amazon River. The conflict with the Booth Line which resulted from this step was amicably settled in 1902 through negotiations conducted by Ballin. Later on, indeed, the relations between the two companies became very cordial, and even led to the conclusion of a far-reaching community of interest agreement, the Booth Line being represented in Hamburg by the Hamburg-Amerika Linie, and the latter in Brazil by the British company. An agreement of such kind was only feasible when a particularly strong feeling of mutual trust existed between the two contracting partners, and Ballin repeatedly declared that he looked upon this agreement with the Booth Line as the most satisfactory of all he had concluded.

In 1900 the West Indian business was extended by opening a passenger service to Mexico, and another noteworthy event which took place during the same year was the conclusion of an agreement with the big German iron works in the Rhenish-Westphalian district by which the Hamburg-Amerika Linie undertook to ship to Emden the Swedish iron ore needed by them from the ports of Narvik and Lulea. Two special steamers were ordered to be exclusively used for this service. Henceforth Emden began to play an important part in connexion with the German ore supply, and the real prosperity of that port dated from that time.

Early in 1901 Ballin decided to embark on a trip round the world. He thought it desirable to do so in order to acquire a first-hand knowledge of the Far Eastern situation, which had become of special interest to the country owing to the acquisition by Germany of Tsingtau, and to the unrest in China. His special object was to study the questions that had become urgent in connexion with the organization of the passenger service of which the Packetfahrt, in consequence of the agreement with the Lloyd, had just become a partner. There was, in addition, the project of starting a Pacific service, which engaged his attention. All these important details could only be properly attended to on the spot. It became necessary to acquire a business footing in the various ports concerned, to organize the coast transport services which were to act as feeders to the main line, etc. Besides, the Packetfahrt, and the Lloyd as well, had special reasons for being interested in Far Eastern affairs, as both companies had been entrusted with troop transports and the transport of equipment needed for the German contingent during the troubles in China. During his Far Eastern trip Ballin wrote detailed accounts dealing with the business matters he attended to, and also describing his personal impressions of persons and things in general, the former kind addressed to the Board of his Company, the latter to his mother. These letters are full of interest; they present a more faithful description of his character as a man, and as a man of business, than could be given in any other way. I shall therefore quote a few extracts from the comprehensive reports, commencing with those he wrote to his mother:—

“On board the I.M.S. ‘Kiautschou’
“January 16th, 1901.

“The weather was cold and windy when we arrived late at night outside Port Said, and midnight was well past when we had taken up the pilot and were making our way into the port. The intense cold had caused me to leave the navigating bridge; and as I did not think it likely that our agent would arrive on board with his telegrams until the next morning, I had followed the example of my wife and of nearly all the other passengers and had gone to bed. However, if we had thought that we should be able to sleep, we soon found out our mistake. The steamer had scarcely taken up her moorings when several hundreds of dusky natives, wildly screaming and gesticulating, and making a noise that almost rent the skies, invaded her in order to fill her bunkers with the 800 tons of coal that had been ordered. Perhaps there is no place anywhere where the bunkers are filled more rapidly than at Port Said, and certainly none where this is done to the accompaniment of a more deafening noise. Just imagine a horde of natives wildly screaming at the top of their voices, and add to this the noise produced by the coal incessantly shot into the bunkers, and the shouting of the men in command going on along with it. You will easily understand that it was impossible for anyone to go to sleep under conditions such as these.... After trying for several hours, I gave up the attempt, and, on entering the drawing-room, I found that willy-nilly (but, as Wippchen would have said, more nilly than willy) practically all the other passengers had done the same thing. There I was also informed that those who were in the know had not even made an attempt to go to sleep, but had gone ashore at 2 A.M. Port Said is a typical brigands’ den, and relies for its prosperity on the mail packets calling there. The shops, the taverns, the music-halls, and the gambling places are all organized on lines in accordance with the needs of modern traffic. So it was not surprising to see that the proprietors of these more or less inviting places of entertainment had brightly lit up their premises, and hospitably opened their doors despite the unearthly hour, being quite willing to try and entice the unwary passengers into their clutches.”

“Between Aden and Colombo.
“January 24th, 1901.

“ ... We did not stop long at Aden; and as the quarantine regulations for all vessels arriving from Port Said were very strict, it became impossible for the passengers on board the Kiautschou to land on the island. Aden, which the British would like to turn into a second Gibraltar, is situated in a barren, treeless district, and is wedged in between hills without any vegetation. Small fortifications are scattered all over the island. It must be a desolate spot for Europeans to live at. The British officers call it ‘The Devil’s Punch Bowl,’ and to be transferred to Aden is equivalent to them to being deported.”

“January 28th, 1901.

“ ... In the meantime we have spent a most enjoyable and unforgettable day at Colombo. The pilot brought the news of Queen Victoria’s death, which filled us with lively sympathy, and which caused a great deal of grief among the British passengers. Shortly before 9 o’clock we went ashore: and as the business offices do not open until an hour later—thus preventing me from calling on my business friends at that hour—I took a carriage-drive through the magnificent park-like surroundings of the city. The people one meets there are a fit match to the beautiful scenery; but whilst in former times they were the rulers of this fertile island, they are now, thanks to the blessings of civilization, the servants of their European masters....

“When we reached the old-established Oriental Hotel where we had our lunch, we met there a number of our fellow-passengers busily engaged in bargaining with the Singhalese and Indian dealers who generally flock to the terraces of the hotel as soon as a mail packet has arrived. The picture presented by such Oriental bargaining is the same everywhere, except that the Colombo dealers undeniably manifest an inborn gracefulness and gentlemanly bearing. When I tried to get rid of an old man who was pestering me with his offers to sell some precious stones, he said to me, in the inimitable singing tone of voice used by these people when they speak English: ‘Just touch this stone, please, but do not buy it: I only wish to receive it back from your lucky hands.’ In spite of their manners, however, these fellows are the biggest cheats on earth. Another dealer wanted to sell me a sheet of old Ceylon stamps for which he demanded fifteen marks—a price which, as he stated, meant a clean loss of five marks to him. When I offered him two marks instead, merely because I had got tired of him, he handed me the whole sheet, and said: ‘Please take them; I know that one day I shall be rewarded for the sacrifice which I bring.’ Later on I discovered that the same man had sold exactly the same stamps to a fellow-passenger for 50 pfennigs, and that he had told the same story to him as to me. Such are the blessings of our marvellous civilization....

“ ... In the afternoon we went for a magnificent drive to the Mount Lavinia Hotel, which is beautifully situated on a hill affording an extensive view of the sea. Boys and girls as beautiful as Greek statues, and as swift-footed as fallow deer, pursued us in our carriage, begging for alms. It was curious to see with what unfailing certainty they managed to distinguish the German from the English passengers, and they were not slow in availing themselves of this opportunity to palm off what little German they knew on us. ‘Oh, my father! My beautiful mother! You are a great lady! Please give me ten cents, my good uncle!’ We were quite astonished to meet such a large progeny....”

“February 2nd, 1901.

“.... The entrance to Singapore is superbly beautiful. The steamer slowly wended her way through the channels between numerous small islands clad with the most luxurious vegetation, so that it almost took us two hours to reach the actual harbour.... The food question is extremely complicated in this part of the tropics, which is favoured by kind Nature more than is good. The excessive fertility of the soil makes the cultivation of vegetables and cereals quite impossible, as everything runs to seed within a few days, so that, for instance, potatoes have to be obtained from Java, and green vegetables from Mulsow’s, in Hamburg. I am sure my geography master at school, who never ceased to extol the richness of the soil of this British colony, was not aware of this aspect of the matter.

“Singapore is a rapidly developing emporium for the trade with the Far East. It has succeeded in attracting to itself much of the commerce with the Dutch Indies, British North Borneo, the Philippines, and the Federated Malay States. To achieve this, of course, was a difficult matter, even with the aid of the shipping companies, but its clever and energetic business community managed to do it. We Germans may well be proud of the fact that our countrymen now occupy the premier position in the business life of the city....

“ ... We spent about thirty-six hours at Saigon. This city has been laid out by the French with admirable skill, and there is no doubt but that Indo-China is a most valuable possession of theirs. As regards the difference in the national character of the French and the British, it is interesting to note that the former have just erected a magnificent building for a theatre at Saigon, at a cost of 2½ million francs. The British would never have dreamt of doing such a thing; I am sure they would have invested that money in the building of club-houses and race-courses....”

“February 16th, 1901.

“ ... As far as social life and social pleasures are concerned, it must be said that the German colony at Hongkong is in no way inferior to that at Singapore. Premier rank in this respect must be assigned to the Siebs family. Mr. Siebs, the senior member of the Hamburg firm of Siemssen and Co., has been a resident in the East for a long term of years—forty-two, if I remember rightly; and he now occupies an exceedingly prominent position both in German and British society. That this is so is largely due—apart from his intimate knowledge of all that concerns the trade and commerce of China, and apart from his own amiability and never-failing generosity—to his charming wife, who, by means of the hospitality, the refinement, and the exemplary management characterizing her home, has been chiefly instrumental in acquiring for the house of Siebs the high reputation it enjoys. Whoever is received by Mrs. Siebs, I have been told, is admitted everywhere in Hongkong society.

“Even though I only give here an outline of my impressions, I cannot refrain from adding a few details dealing with some aspects of everyday life at Hongkong, this jewel among the crown colonies of Britain. The offices of the big firms and of the shipping companies’ agencies, most of them housed in beautiful buildings, flank the water’s edge; farther back there is the extensive shopping quarter, and still more in the rear there is the Chinese quarter, teeming with an industrious population. Being myself so much mixed up with the means of communication, I am surely entitled to make a few remarks concerning this subject in particular. Horses are but rarely seen, and are only used for riding, and sporting purposes generally. Their place is taken by the coolies, who no doubt represent the most pitiable type of humanity—at least, from the point of view of a sensitive person. In the low-lying part of the town the jinrikishas, which are drawn by coolies, predominate; but the greater part of Hongkong is situated on the slopes of a hill, and nearly all the private residences are built along the beautifully kept, terrace-like roads leading up to the summit of the peak. In this part the chair coolies take the place of the jinrikisha coolies; and in the low-lying parts also it is considered more stylish to be carried by chair coolies. The ordinary hired chairs are generally carried by two coolies only, but four are needed for the private ones. The work done by these poor wretches is fatiguing in the extreme. They have to drag their masters up and down the hill, which is very steep in places, and it is a horrid sensation to be carried by these specimens of panting humanity for the first time. In the better-class European households each member of the family has his own chair, and the necessary coolies along with it, who are paid the princely wage of from 16 marks to 17 marks 50 pfennigs a month. They also receive a white jacket and a pair of white drawers reaching to the knee, but they have to provide their own food. The poor fellows are generally natives from the interior parts of the island. They spend about one mark a week on their food; the rest they send home to their families. They are mostly married, and the money they earn in their capacity as private coolies represents to them a fortune. They rarely live longer than forty years; in fact, their average length of life is said not to exceed thirty-five. As many as eight coolies were engaged to attend to the needs of my wife and myself for the time of our stay. The poor creatures, who, by the way, had quite a good time in our service, spent the whole day from early in the morning to late at night lying in front of a side entrance to our hotel, except when they had to do their work for us....

“ ... The Chinese have only one annual holiday—New Year. They are hard at work during the whole year; they know of no Sundays and of no holidays, but the commencement of the New Year is associated with a peculiar belief of theirs. To celebrate the event, they take their best clothes out of pawn (which, for the rest of the year, they keep at the pawnbroker’s to prevent them from being stolen). To keep the evil spirits away during the coming twelvemonth, they burn hundreds of thousands of firecrackers when the New Year begins, and also during the first and second days of it, accompanied by the noise of the firing of guns. One must have been through it all in order to understand it. For the better part of two days and two nights one could imagine a fierce battle raging in the neighbourhood; crackers were exploding on all sides, together with rockets and fireballs, and the whole was augmented by the shouting and screaming of the revellers. It was a mad noise, and we could scarcely get any sleep at night.

“The houses in the Chinese quarter were decorated up to the roofs with bunting, beautiful big lanterns, paper garlands with religious inscriptions, and a mass of lovely flowers.

“On such days—the only holidays they possess—the Chinese population are in undisputed possession of their town, and the British administration is wise enough not to interfere with the enjoyment of these sober and hard-working people. I really wonder how the German police would act in such cases....”

“Shanghai, March 6th, 1901.

“ ... It is surely no exaggeration to describe Shanghai as the New York of the Far East. The whole of the rapidly increasing trade with the Yangtse ports, and the bulk of that with the northern parts of the country, passes through Shanghai. The local German colony is much larger than the one at Hongkong; and here, too, it is pleasant to find that our countrymen are playing an extremely important part in the extensive business life of the town....”

“Between Tsingtau and Nagasaki,
on board the s.s 'Sibiria.’
“March 18th, 1901.

“Our s.s. Sibiria had arrived in the harbour about ten days ago, and was now ready for our use. I had decided first of all to make a trip up the Yang-tse-Kiang on board the Sibiria, because I wanted to get to know this important river, which flows through such a fertile tract of country, and on the banks of which so many of the busiest cities of China are situated. The Yangtse—as it is usually called for shortness’ sake—is navigable for very large-sized ocean-going steamers for a several days’ journey. During the summer months it often happens that the level of the water in its upper reaches rises by as much as 50 feet, which—on account of the danger of the tremendous floods resulting from it—has made it necessary to pay special attention to the laying-out of the cities situated on its banks. The object of our journey was Nanking. This city, which was once the all-powerful capital of the Celestial Empire, has never again reached its former importance since its destruction during the great revolution of 1862, and since the choice of Peking as the residence of the Imperial family. Two years ago it was thrown open to foreign commerce; and the Powers immediately established their consulates in the city, not only because a new era of development is looked forward to, but also because Nanking is the seat of a viceroy.

“Our amiable consul, Herr v. Oertzen, received us with the greatest hospitality. The German colony which he has to look after consists of only one member so far. This young gentleman, who holds an appointment in connexion with the Chinese customs administration, feels, as is but natural, quite happy in consequence of enjoying a practical monopoly of the protection extended to him by the home government. He has helped himself to the consul’s cigars and to his moselle to such good effect that the Sibiria arrived just in time to prevent the German colony at Nanking from lodging a complaint regarding the insufficiency of the supplies put at its disposal by the Government. The consul told us that we should never have a chance of coming across another Chinese town that could compare with the interior of Nanking, and so we had to make up our minds to pay a visit to these parts.

“I had seen plenty of dirt and misery at Jaffa and Jerusalem, but I have never found so much filth and wretchedness anywhere as I noticed at Nanking. My wife and a charming young lady who accompanied us on our Yangtse expedition were borne in genuine sedan chairs as used for the mandarins, preceded by the interpreter of the consulate, and followed by the rest of us, who were riding on mules provided with those typically Chinese saddles, which, owing to their hardness, may justly claim to rank among the instruments of torture.

“Our procession wended its way through a maze of indescribably narrow streets crowded with a moving mass of human beings and animals. Everywhere cripples and blind men lay moaning in front of their miserable hovels, and it almost seemed that there were more people suffering from some disease or other than there were healthy ones. When we stopped outside the big temple of Confucius, where the ladies of our party dismounted from their chairs, the people, in spite of their natural timidity, flocked to see us, because they had probably never seen any European ladies until then. We were thankful when at last we reached the consulate building again, and when, after having had a good bath, we are able to enjoy a cup of tea.

“ ... In the early hours of March 13th our steamer arrived at Tsingtau. I was surprised and delighted with what I saw. There, in spite of innumerable difficulties, a city had sprung up in an incredibly short space of time.

“Rooms had been reserved for us at the handsome, but very cold, Hotel Prinz Heinrich; and in the afternoon of the day of our arrival we strolled up the roads, which were still somewhat dusty, and in parts only half finished, to the summit of the hill where the acting Governor and the officers of higher rank had their homes. Even though it is true that up to now military necessities have taken precedence in the laying-out of the town, so that the needs of trade and traffic have not received due attention, it must be admitted that a wonderful piece of constructive work has been achieved. All the members of our party—especially those who, like Dr. Knappe, our consul-general at Shanghai, had known the place two years ago—were most agreeably surprised at the progress that had been made.

“Our first few days at Tsingtau were spent much as they were everywhere else—plenty of work during the day-time, and plenty of social duties in the evenings. But things began to look different on Saturday morning, when my old friend and well-wisher, Field-Marshal Count Waldersee, arrived on board H.M.S. Kaiserin Auguste. He had announced that his arrival would take place at 9 A.M., and his flagship cast anchor with military punctuality. The Governor and I went on board to welcome the old gentleman, who was evidently greatly touched at meeting me out here, and it was plain to see that my presence in this part of the world made him almost feel homesick. The Field-Marshal very much dislikes the restrictions imposed on his activities; and judging from all he told me, I must confess that a great military leader has hardly ever before been faced with a more thankless task than he. On the one hand he is handicapped through the diplomatists, and on the other through the want of unanimity among the Powers. Thus, instead of fulfilling the soldier’s task with which he is entrusted, he is compelled to waste his time in idleness, and to preside at endless conferences at which matters are discussed dealing with the most trivial questions of etiquette. He really deserves something better than that....”

“Tokio. March 31st, 1901.

“ ... What a difference between Japan and the cold and barren north of China! There everything was dull and gloomy, whilst this country is flooded with sunshine. Here we are surrounded by beautifully wooded hills, and a magnificent harbour extends right into the heart of the city. From the windows of our rooms we overlook big liners and powerful men-of-war, and our own Sibiria has chosen such a berth that the Hapag flag merrily floating in the breeze gives us a friendly welcome.

“The difference in the national character of the Chinaman and the Japanese clearly proves the great influence which the climate and the natural features of a country can exercise on its inhabitants. The one always grave and sulky, and not inclined to be friendly; the other always cheerful, fond of gossip, and overflowing with politeness in all his intercourse with strangers. But it must not be forgotten that the integrity of the Chinese, especially of the Chinese merchants, is simply beyond praise, whereas the Japanese have a reputation for using much cunning and very little sincerity, so that European business men cannot put much faith in them.

“The women of Japan are known to us through ‘The Mikado’ and ‘The Geisha.’ They make a direct appeal to our sympathies and to our sense of humour. In one week the stranger will become more closely acquainted with the womenfolk and the family life of Japan than he would with those of China after half a dozen years of residence in their midst. In China the women are kept in seclusion as much as possible, but the whole family life of the Japs is carried on with an utter indifference to publicity. This is due to a large extent to the way their homes are built. Their houses are just as dainty as they are themselves; and it is really quite remarkable to see that the Japs, who closely imitate everything they see in Europe, still build them exactly as they have done from time immemorial. They are practically without windows, and in place of these the openings in the walls are filled with paper stretched on to frames. Instead of doors there are movable screens made of lattice-work; and since everything is kept wide open during the day-time one can look right into the rooms from the street. In the summer the Japanese make their home in the streets, and we are told that then the most intimate family scenes are enacted in the open air. I am of opinion that this, far from pointing to a want of morality, is really the outcome of a highly developed code of morals. Things which are perfectly natural in themselves are treated as such, and are therefore not hidden from the light of day....

“ ... At 9 A.M. on March 23rd we arrived at Kobe, where we had to spend several days.

“Our trip is now approaching its end; at least, we now experience the pleasant feeling that we are daily nearing home. What will it look like when we get back? At almost every port of call some sad news has reached us, and our stay at Kobe was entirely overshadowed by my grief at the loss of my old friend Laeisz. Even now I cannot realize that I shall find his place empty when I return....”

The brief statement in which Ballin summarized the results of his trip from a business point of view is appended:—

“Among the business transacted during my trip the following items are of chief importance:

“(1) The establishment of a branch of our Company at Hongkong.

“(2) The acquisition of the Imperial Mail Packet Service to Shanghai, Tsingtau, and Tientsin, formerly carried on by Messrs. Diedrichsen, Jebsen and Co.

“(3) The acquisition of the Yangtse Line, hitherto carried on by the firm of Rickmers.

“(4) The joint purchase with the firm of Carlowitz and Messrs. Arnhold, Karberg and Co. of a large site outside Shanghai harbour intended for the building of docks and quays, and the lease of the so-called Eastern Wharf, both these undertakings to be managed by a specially created joint-stock company.

“(5) The establishment of temporary offices at Shanghai.

“(6) In Japan discussions are still proceeding concerning the running of a line from the Far East to the American Pacific coast.

“(7) In New York negotiations with the representative of the firm of Forwood are under way regarding the purchase of the Atlas Line.”

This list summarizes the contents of a long series of letters from all parts of the world where Ballin’s keen insight, long foresight, and business acumen suggested to his alert mind possibilities of extending Packetfahrt shipping interests. Time translated many of his suggestions into flourishing actualities, some of which survived the 1914-18 years; others disappeared in the cataclysm; others, again, by the lapse of time have not the keen general interest that appertained to the ideas when they fell fresh-minted from his pen. The following, however, in regard to China and Japan, are worthy of record:

In 1903 far-reaching alterations were made in the relations existing between the Hamburg-Amerika Linie and the North German Lloyd, which had become somewhat less friendly than usual in more respects than one; and in particular the agreement concerning the Far Eastern services of both companies was subjected to some considerable modifications.

The year 1903 is also remarkable for an event which, although not of great importance from the business point of view, is of interest in other respects. This event was the establishment of business relations with a Danish company concerning, in the first place, the West Indian trade, and later that with Russia also. The Danish concern in question was the East Asiatic Company, of Copenhagen. The founder of this company was a Mr. Andersen, one of the most successful business men known to modern commercial enterprise, and certainly not only the most successful one of his own country, but also one of high standing internationally. When still quite young he founded a business in Further India which, although conducted at first on a small scale only, he was able to extend by the acquisition of valuable concessions, especially of teak-wood plantations in Siam. In course of time this business developed into a shipping firm which, owing to the concessions just mentioned, was always in a position to ship cargo of its own—an advantage which proved inestimable when business was bad and no other freight was forthcoming. When Mr. Andersen returned to Europe he continued to enlarge his business, making Copenhagen its centre. He enjoyed the special patronage of the Danish Royal Family, and afterwards also that of the Imperial Russian family. His special well-wisher and a partner of his firm was the Princess Marie of Denmark, who became known in the political world because she incurred the enmity of Bismarck, chiefly on account of her attempt to stir up ill feeling between the Iron Chancellor and Tsar Alexander III. Bismarck, in the second volume of his memoirs, describes how he succeeded in circumventing her plans through a personal meeting with the Tsar. It was the exceptional business abilities of the Princess Marie which brought Mr. Andersen into contact with the Russian Imperial family. It is typical of the common sense of the Princess and of her unaffected manners that she arrived at the offices of the Hamburg-Amerika Linie one day without having been previously announced; and as she did not give her name to the attendant outside Ballin’s private office, he could only tell him that “a lady” wanted to see him. The two letters addressed to Ballin which are given below are also illustrative of her style.

“Yours faithfully,
(signed) “Marie.”

In June, 1904, after the close of Kiel Week, Ballin paid a visit to Copenhagen. There he met the Princess Marie and the King and Queen of Denmark, and was invited to dine with them at Bernstorff Castle. The business outcome of the negotiations was that in 1905 a joint service to the West Indies was established between the Hamburg-Amerika Linie and the Danish West Indian Company. Four of the big new steamers of the latter were leased to the Packetfahrt, and operated by that company, which thus not only increased the tonnage at its disposal, but also succeeded in eliminating an unnecessary competition.

At the same time the Packetfahrt bought the larger part of the shares of the Russian East Asiatic S.S. Company owned by the Danish firm. The object of the purchase was to establish a community of interests with the Russian Company. The Kaiser took great interest in this scheme, and during his visits to Copenhagen in 1903 and 1905 Mr. Andersen reported to him on the subject. It was intended to bring about close business relations between Germany, Russia, and Denmark for the special purpose of developing Russian trade, and to organize the Russian East Asiatic S.S. Company on such lines as would make it a suitable instrument to this end. It is to be regretted that the community of interest agreement then concluded was not of long duration. The Russian bureaucracy made all sorts of difficulties, and it is possible that the representatives of the Hamburg-Amerika Linie in Russia did not display as much discretion in their dealings with these functionaries as they ought to have done. At any rate, the Packetfahrt was so little satisfied with its participation in this Russian concern that it re-sold its rights to the interested Copenhagen parties in 1906, not without incurring a considerable loss on the transaction. The West Indies agreement automatically lapsed when the Packetfahrt acquired sole possession of the four Danish steamers.

Later on some sort of co-operation with the Russian company was brought about once more by the admission of that company to the transatlantic steerage pool. The Packetfahrt also had an opportunity of profiting from the technical experience gained by the Danish East Asiatic Company, which was the first shipping concern to specialize in the use of motor-ships. It was enabled to do so by the support it received from the shipbuilding firm of Messrs. Burmeister and Wain, of Copenhagen, who had applied the Diesel engine, a German invention, to the propulsion of ships, and who subsequently built a fleet of excellent motor-ships for the East Asiatic Company. One of these vessels was afterwards acquired by the Hamburg-Amerika Linie for studying purposes. The new type of vessel proved exceedingly remunerative during the war, as it made the owners independent of the supply of British bunker coal, and relieved them of the numerous difficulties connected with obtaining it. This great practical success of the Danish shipbuilders became possible only because they applied themselves consistently to the development of one particular type of engine, whereas in Germany endless experiments were made with a great variety of different types which led to no tangible results. It was only when the war came, and when the building of numerous submarines became necessary that German engineering skill obtained a chance of showing what it could do, and then, indeed, it proved itself worthy of the occasion.

In 1904 war broke out between Russia and Japan, an event which exercised such an influence on the Packetfahrt that it is hardly an exaggeration to say that the rapid progress the company made during the next few years amounted to a re-birth. The war provided the company with a chance to sell a large number of its units at a considerable rate of profit, and the contract concluded with the Russian Government for the coal supply added enormously to its revenues. The Russian Government partly converted the purchased steamers into auxiliary cruisers for the purpose of checking and disorganizing Japanese sea-borne trade, and it partly used them to accompany its Baltic fleet on its way to the Far East. As an illustration of the magnitude and the complexity of this transaction, it may be permitted to quote a few extracts from Ballin’s notes referring to it:

A few statistics will show what the whole undertaking meant to the Hamburg-Amerika Linie from a business point of view. During the years 1904 and 1905 the company increased its fleet by no less than 21 steamers—partly new buildings and partly new purchases—representing a value of 22½ million marks. To these new acquisitions must be added the 19 steamers then building, of a value of 52 million marks, amongst them the two big passenger steamers Amerika and Kaiserin Auguste Victoria for the New York route, and other big boats for the Mexico, the River Plate, and the Far East services. A large fraction of the sums spent on this new tonnage—viz. no less than 24 million marks—represented the profits made on the sales of ships; another large portion was taken out of current earnings, and the remainder was secured by a debenture issue. Never again, except in 1913, has the company added such an amount of tonnage to its fleet in a single year as it did at that time. But the “re-birth” of the company did not only consist in this augmentation of tonnage, but also, and chiefly, in the entire reorganization of its New York service by the addition to its fleet of the Amerika and the Kaiserin Auguste Victoria. This event meant that the era of the express steamers was being succeeded by one characterized by another type of vessel which, though possessing less speed, was mainly designed with a view to securing the utmost possible comfort to the passengers. The two steamers proved exceedingly remunerative investments, and added enormously to the clientÈle of the company. The profits earned on the Russian transaction also made up to a large extent for the losses incurred in the keen rate war with the Cunard Line then in progress. In spite of this rate war the company was able to increase its dividend to 9 per cent. in 1904, and to 11 per cent. in 1905.

Another event which took place in 1904 was the conclusion of a contract with the German Government concerning the troop transports to German South-West Africa, and the year 1905 witnessed the settlement of a short-lived conflict with the North German Lloyd. This conflict attracted a great deal of attention at the time, and the Kaiser himself thought fit to intervene with a view to terminating it.

When it was seen that German commercial interests in the Middle East had considerably increased, the Hamburg-Amerika Linie opened a special line to the Persian Gulf in 1906. The year 1907 is chiefly remarkable for a rate war affecting the services from Hamburg to the West Coast of Africa, of which until then the Woermann Line had considered itself entitled to claim a monopoly.

The African shipping business had been jealously nursed by its founder, Adolph Woermann, who had always tried hard to guard this special domain of his against the encroachments of all outsiders. However much Ballin and Adolph Woermann differed in character, they were akin to each other in one essential feature—viz. the jealous love they bore to the undertaking with which they had identified themselves. Both men, grown up in absolutely different environments, yet resembled each other in the daring and the fearlessness with which they defended the interests of their businesses. The one had trained himself to employ moderation and commonsense to overcome resistance where the use of forcible means promised no success; the other was a pioneer in the colonial sphere, a king in his African empire, the discoverer of new outlets, but broken in spirit and bereft of his strength when compelled by circumstances to share with others. When Adolph Woermann had died, Ballin honoured his memory by contributing to the public Press an appreciation of his character, which is perhaps the best that has been written, and which ought to be saved from being forgotten. This fact, it is hoped, will be sufficient justification for reproducing in this connexion a translation of Ballin’s article:

To complete the enumeration of the many rate wars which occurred during the first decade of the twentieth century, we must make brief reference to the competition emanating in 1909 from the so-called “Princes’ Trust” (FÜrstenkonzern) and its ally, viz. a Hamburg firm which had already fought the Woermann Line. The object of the fight was to secure the business from Antwerp to the Plate. The struggle ended with the acquisition of the shipping interests of the Princes’ Trust, the business career of which came to a sudden end shortly afterwards by a financial disaster causing enormous losses to the two princely families concerned—the house of Hohenlohe and that of FÜrstenberg. The details connected with this affair are still in everybody’s memory, and it would be beyond the scope of this volume to enter into them. It should be mentioned, however, that in connexion with the settlement arrived at the two big companies undertook to start some transatlantic services from the port of Emden, and in particular to establish a direct line for the steerage traffic to North America. The necessary arrangements to this end had just been made when the war broke out, and further progress became impossible.

The transatlantic pool was considerably extended in scope during those years. More than once, however, after the rate war with the Cunard Line had come to an end, the amicable relations existing between the lines were disturbed, e.g. when the Russian Volunteer Fleet opened a competing service—a competition which was got rid of by the aid of the Russian East Asiatic S.S. Company; when some British lines temporarily withdrew from the steerage pool, and when some differences of policy arose between the Hamburg-Amerika Linie and the North German Lloyd. The Hamburg company demanded a revision of the percentages, contending that the arrangements made fifteen years ago no longer did justice to the entirely altered relative positions of the two companies. The discussions held in London in February, 1908, under Ballin’s chairmanship, which lasted several days, and in which delegates of all the big Continental and British lines, as well as of the Canadian Pacific Railway Company took part, led to the formation of the Atlantic Conference (also known as the General Pool). It was supplemented in the following year by that of the Mediterranean Conference. Both these agreements were renewed in 1911, and further agreements were concluded with the Russian and Scandinavian lines to complete the system. Agreements on so large a scale had never before been concluded between any shipping companies.

This network of agreements existed until it was destroyed through the outbreak of the war.

During the fluctuating conditions which characterized the shipping business of those years the year 1908 witnessed a depression which, in its after-effects, is comparable only to that caused by the cholera epidemic sixteen years earlier. Business had been excellent for a fairly long time, but it became thoroughly demoralized in the second half of 1907, and an economic crisis of a magnitude such as has seldom been experienced began to affect every country. No part of the shipping business remained unaffected by it; hundreds and hundreds of ocean-going liners lay idle in the seaports of the world.

Very gradually prospects began to brighten up in the course of 1908, so that the worst of the depression had passed sooner than had been expected. Indeed, in one respect the crisis had proved a blessing in disguise, inasmuch as it had strengthened the inclination of the shipping concerns everywhere to compromise and to eliminate unnecessary competition—the formation of the general pool, in fact, being the outcome of that feeling. The subsequent recovery made up for the losses; and the succeeding years, with their very gratifying financial results, and their vast internal consolidation, represent the high-water mark in the development of the Hamburg-Amerika Linie.

Shortly after the end of the depression a renewed spell of building activity set in. First of all a new cargo steamer, possessing a burden of 12,000 tons—which was something quite unusual at the time—was ordered to be built by Messrs. Harland and Wolff, at a price which was also unusually low. It almost created a record for cheapness; and the courage of the builders who accepted such an order at such terms was greatly admired. A German yard—the Vulkan, of Bremen—then came forward with a similar offer, because the German shipbuilders, too, were glad to provide their men with work. The result of the combined labour of both these firms was a type of cargo boat which proved extremely useful, especially in the Far Eastern trade, and which represented a good investment to the company.

Gradually the other branches of the business began to increase their activity, and the service to North America especially received the close attention of the company’s management. Meanwhile, other shipping companies had added some vessels of the very highest class to their fleets. The two big turbine steamers of the Cunard Line, the Lusitania and the Mauretania, had attracted many passengers, and the White Star Line had the mammoth liner Olympic building, which was to be followed by two others of the same type, the Titanic and the Gigantic. The new Cunarder, the Aquitania, was to be of the same type, so that once more the public was offered the choice of steamers of a kind unknown until then. This competition compelled the Packetfahrt to follow suit, and Ballin commenced to evolve plans for the building of a new vessel which, of course, had to surpass the highest achievement of the competing lines, i.e. the Olympic. Thus, in co-operation with the Vulkan yard, of Stettin, and with Messrs. Blohm and Voss, of Hamburg, the plans for the three steamers of the “Imperator” class were designed. The competition among the various yards had been extremely keen, and the Vulkan yard secured the order for the building of the first unit of this class, the Imperator. From the point of view of speed, these new vessels resembled the fast steamers of the older kind; with regard to their equipment, they represented a combination of this type and that of the Kaiserin, but from the business point of view they were quite a novelty, as the basis of their remunerativeness was no longer the cargo and steerage business, but the cabin business. If the booking of a certain number of cabins could be relied on for each voyage an adequate return would be assured. Everything, therefore, was done to attract as many cabin passengers as possible. These vessels were a triumph of German shipbuilding and engineering skill; and the senior partner of Messrs. Blohm and Voss, when the Vaterland was launched, stated with just pride that she was the biggest vessel in existence; that she was built on the biggest slip; that she had received her equipment under the biggest crane, and that she would be docked in the biggest floating dock in the world. The launching of the third and biggest of the three steamers, the Bismarck, represented a red-letter day in the life of Ballin and in the history of the company. Nominally she was christened by the granddaughter of the Iron Chancellor, but actually by the Kaiser. The bottle of champagne used for the purpose did not break when it left the young lady’s hands; but the Kaiser seized it, and with a sweeping movement of the arm hurled it against the stem of the huge vessel. To remove as far as possible the last vestige of the unhappy estrangement between the Kaiser and the Chancellor had always been Ballin’s earnest desire. So it filled him with great joy when he was enabled to dedicate the greatest product of his life-work to the memory of the Prince whom he admired intensely; and still more was he pleased when the Kaiser consented to take part in the ceremony. He had often expressed his regret at the unfortunate stage management in connexion with the Kaiser’s visit to Hamburg after the unveiling of the Bismarck monument, when he was driven past it without an opportunity having been arranged for him to inspect it. Such a course, Ballin remarked, was bound to create the impression that the Kaiser had intentionally been led past it. “I wish I had been permitted to speak to the Kaiser about it beforehand,” he told me afterwards. “I am sure he would have insisted upon seeing it.” Proper stage management plays so prominent a part in the life of royalty, and it can be of such great use in avoiding certain blunders and in hiding certain shortcomings that it is much to be regretted that the Kaiser had so often to dispense with it.

The entering into the Packetfahrt’s service of the “Imperator” type of steamers represented an extraordinary increase in the amount of tonnage which the company employed on the New York route; and when the North German Lloyd refused to allow the Packetfahrt a corresponding addition to its percentage share under the pool agreement, which the Packetfahrt believed itself justified in asking for, a conflict threatened once more to disturb the relations existing between the two companies. As a result the position of both was weakened in Austria, where the Government cleverly used the situation to its own advantage. Apart from this, however, not much damage was done, as negotiations were soon started with the object of securing the conclusion of a far-reaching community of interest agreement which was not merely to be restricted to the transatlantic services of the two companies. If these negotiations could be brought to a successful issue, Ballin thought that this would be the dawn of a new era in the contractual relations existing between shipping firms everywhere, because he believed that such development would not be confined to the German lines, but would assume international proportions. The agreements actually in force seemed to him obsolete—at least in part. That this should be so is but natural, as the factor which it is intended to eliminate by the terms of such agreements—man’s innate selfishness—is, after all, ineradicable. “Nature,” in the words of the Roman poet, “will always return, even if you expel it with a pitchfork.” Wherever a human trait like selfishness is to be kept within certain bounds by means of written agreements, it becomes necessary not only to make small improvements from time to time, but to subject the whole system to a thorough overhauling every now and then.

Many events affecting the progress of the company’s business have no reference in these pages, but the reader can visualize the importance of Albert Ballin’s life-work if he keeps before his mind the fact that while in the early part of 1886 the Hamburg-Amerika Linie maintained but a mail service from Hamburg to New York and four lines to Mexico and the West Indies, from that date to 1913 fifty new services were added to the existing ones.

The fleet possessed by the Hamburg-Amerika Linie in 1886 consisted of 22 ocean-going steamers, totalling 60,531 G.R.T.[1] By the end of 1913 these figures had increased to 172 steamers and 1,028,762 G.R.T. respectively. During the twenty-eight years 269 vessels of 1,388,206 tons had been added, either by new building or by purchase, and 101 steamers of 346,927 tons had been sold. At the end of 1913 19 steamers of 268,766 tons were building, so that, including these, the total tonnage amounted to 1,360,360 G.R.T. at that date.

During the same period the joint-stock capital of the company had increased from 15 to 157½ million marks, the debenture issues from 5·6 to 69·5 million marks, and the visible reserves from 3,595,285 to 58,856,552 marks.

The working profits of the company during those twenty-eight years amounted to 521,727,426 marks, 2,735,700 of which were Government subsidies received during the temporary participation in the Imperial Mail Service to the Far East.

The average dividend paid to the shareholders was 7·02 per cent. per annum. This figure, to my thinking, proves that the biggest steamship company the world has ever known was to a small extent only a “capitalist enterprise.” Out of a total net profit of over 500 millions, no more than 140 million marks went to the shareholders as interest on their invested capital; by far the greater part of the remainder was used to extend the company’s business, so that the country in general benefited by it.

Concerning one matter which played an important part in Ballin’s career, viz., the relations between his company and the North German Lloyd, the reader may perhaps desire a more exhaustive account. There certainly was no want of rivalry between the two companies. One notable reason for this was the fact that at the time when Ballin joined the Packetfahrt the latter had fallen far behind its younger competitor in its development, both from the business and the technical point of view. The Packetfahrt, in particular, had not kept pace with the technical progress in steamship construction, and the consequence was that, when the pool was set up, it had to content itself with a percentage which was considerably less than that allotted to the Lloyd. The enormous advance made under the Ballin rÉgime naturally caused it to demand a larger share. At the same time the Lloyd also increased its efforts more than ever before, and thus a race for predominance was started between the two big companies, which greatly assisted them in obtaining the commanding position they acquired as the world’s leading shipping firms. I do not think this is the place to go into all the details of this struggle, and I shall confine myself to reproducing an article which Ballin himself contributed in 1907 on the occasion of the fiftieth anniversary of the foundation of the North German Lloyd. As this article throws several interesting sidelights on the development of transatlantic shipping enterprise, it may furnish a suitable conclusion to the account given in the present chapter: